Latimer LeVay Fyock, LLCLatimer LeVay Fyock, LLC

Corporate Transparency Act: Reporting Obligations

Effective January 1, 2024, the Corporate Transparency Act (CTA) will require reporting entities to file a beneficial ownership information (BOI) report with the Financial Crimes Enforcement Network (FinCEN). The BOI will require disclosure of personal information for certain owners and operators of each entity. The CTA aims to enhance corporate transparency to prevent illicit activities such as money laundering, terrorism financing, and other financial crimes. Below are some key takeaways, which are being provided as a high-level overview of the CTA.


  • Start Date: Filing requirements commence on January 1, 2024.
  • Registration: All entities formed or registered to do business in the United Statesmust either timely file a BOI report with FinCEN or confirm that they are exempt from registration.
  • Applicability: Unless specifically exempted from the CTA, most companies, including corporations, limited liability companies, limited liability partnerships, business trusts and limited partnerships, will be subject to the filing requirements.
  • Filing Deadlines: Existing entities formed prior to January 1, 2024, will have one year to file their initial report. New entities formed on or after January 1, 2024, must file with FinCen within 30 days of creation. All entities registered with FinCen, that have a subsequent change to their beneficial owners or operators, must file an updated report within 30 days of the change.
  • Penalties:Failure to comply with the reporting requirements can result in severe penalties to the entity and senior officers, including civil penalties of up to $500 per day and potential criminal penalties for willful violation, until the entity is deemed compliant.


There are 23 exemptions listed under the CTA, including (but not limited to):

  • Large Operating Companies: Entities with more than 20 full-time US employees, over $5 million in revenue from US sources on a consolidated basis and have an operating presence in the United States.
  • Securities Dealer/Broker: Any broker or dealer registered under Section 15 of the Securities Exchange Act of 1934.
  • Regulated Entities: Public companies, insurance companies, banks (including Federal and State credit unions), registered investment companies, registered investment advisors and other groups already subject to regulatory oversight.
  • Domestic Non-Profit Entities: Organizations described in IRC 501(c), certain political organizations and certain non-exempt charitable or split-interest trusts.
  • Subsidiaries: Subsidiary entities (excluding brother/sister entities) that are wholly owned, directly or indirectly, by the foregoing exempt entities.


  • Beneficial Owners: Beneficial owners include any individual (i) who, directly or indirectly, exercises substantial control over the entity (such as a senior officer or manager) or (ii) owns or controls 25% or more of the ownership interests. This includes shareholders, members, partners, and other individuals or entities that have significant control.

    If a trust holds at least 25% ownership and control of a reporting entity, trustees must report themselves and any beneficiaries if the beneficiary is the sole recipient of the trust’s income and principal, or if the trust’s Grantor retains the right to revoke the trust or withdraw asset. Reporting may also be necessary if the trustee (or trust protector, designated representative, or other individual) either owns a majority of voting rights, can direct important company decisions, or has the authority to replace a majority of Directors or senior officers.

    Certain trustees and beneficiaries are exempt from reporting, including corporate trustees not controlled by beneficiaries, minors (although their parents or guardians are required to report), employees, nominees, custodians, or agents for the trustee, individuals anticipating future trust benefits, creditors of the trust, and non-profit entities.

  • Applicants: An applicant includes a maximum of two individuals (i) the person who directly files the formation or registration document of the reporting entity; and (ii) the person who was primarily responsible for directing such filing.


BOI reports will remain confidential and will not be accessible to the public. However, under certain conditions, these reports can be disclosed to federal and state law enforcement agencies. Additionally, with the consent of the reporting entity, BOI reports can be shared with financial institutions to fulfill their ‘Know Your Customer’ obligations.


Ensuring compliance with the Corporate Transparency Act is crucial to avoid potential legal repercussions and to maintain the integrity of your business operations. For more information, see our firm’s post here.

If you have any questions or concerns regarding the Corporate Transparency Act, we strongly encourage you to reach out to the attorney you primarily work with at our firm. We are here to assist you in navigating these new reporting obligations and look forward to hearing from you.