US Entity Transparency &
FinCEN Reporting

As part of global efforts to combat money laundering, terrorist financing, and illicit use of corporate structures, the United States has implemented new transparency requirements through the Corporate Transparency Act (CTA), which came into effect on January 1, 2024.

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Under the CTA, most legal entities formed or registered to do business in the United States—including LLCs and corporations—must report beneficial ownership information (BOI) to the Financial Crimes Enforcement Network (FinCEN), a bureau of the U.S. Department of the Treasury.

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Who Must Report?

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All domestic and foreign entities registered to operate in the U.S. are generally required to report unless they fall under one of the 23 exemptions outlined by FinCEN (e.g., publicly traded companies, certain large operating companies, or regulated entities).

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What Must Be Reported?

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Entities must provide information about:

• The company itself (legal name, trade name, address, jurisdiction, EIN);

• Its beneficial owners (any individual who directly or indirectly exercises substantial control or owns at least 25% of the company);

• The company applicant (the individual who formed or registered the entity, in some cases).

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Deadlines

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• New entities (formed on or after Jan 1, 2024): BOI report must be submitted within 90 days of formation (reduced to 30 days in 2025).

• Existing entities (formed before Jan 1, 2024): Must report by January 1, 2025.

• Updates or corrections: Must be filed within 30 days of any change.

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Penalties for Non-Compliance

 

Failure to comply with FinCEN reporting requirements may result in civil penalties (up to $500 per day) and criminal penalties (including fines up to $10,000 and/or imprisonment for willful violations).