CTA FAQs
If you represent small businesses, you are likely aware of the Corporate Transparency Act (CTA) which went into effect on January 1, 2024. Understanding the intricacies of this Act and how it affects small businesses is crucial to your continued representation of these clients as failing to file or update the necessary report could result in civil or criminal penalties. Below are a few answers to FAQs to introduce the Act and its reporting requirements:
What is the Corporate Transparency Act?
The purpose of the CTA is to collect more ownership information for U.S. businesses as a means of combatting tax fraud, money laundering, and financing for terrorism. Enacted in 2021 but going into effect January 1, 2024, certain businesses must now submit a Beneficial Ownership Information (BOI) Report to the U.S. Department of Treasury’s Financial Crimes Enforcement Network (FinCEN), providing details about those individuals associated with the company.
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