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Who Needs to Report: Small businesses like LLCs, limited partnerships, and corporations with less than 20 employees are likely required to comply. 

 

Penalties for Noncompliance: Failure to comply can lead to a $500 per day penalty, and criminal penalties may include a fine up to $10,000 and/or imprisonment. 

 

Reporting Company Definition: Corporations, LLCs, LLPs, and similar entities registered with the Secretary of State, except trusts and general partnerships. 

 

Exemption Criteria: Companies with over 20 full-time employees in the U.S., over $5M gross revenue, and a physical U.S. office. All three conditions must be met to be considered exempt.

 

Information to Report: Includes legal names, birth dates, addresses, and identification details of beneficial owners and company applicants, along with the company's legal name, DBAs, tax ID, business address, and formation jurisdiction. 

 

Effective Dates: Reporting starts on January 1, 2024. Existing businesses must report by January 1, 2025. Entities formed after January 1, 2024, have 90 days to report in 2024 and 30 days thereafter. 

 

Updates and Corrections: Changes or inaccuracies must be reported within 30 days of discovery. 

 

Definition of Beneficial Owner: An individual with substantial control or at least a 25% ownership interest, including through contracts, arrangements, or relationships. 

 

OUR RECOMMENDATION: This is intended only to give you a brief overview. We understand that interpreting or advising on the CTA is considered practicing law, and we therefore recommend you contact your attorney for advice and assistance. 

 

 Revised 11/26/23