Corporate Transparency Act: Know if it applies to your business

A new federal law that went into effect in January will likely affect many businesses in Wisconsin and across the country—in particular, many small businesses that may not even be aware of the new law. The Corporate Transparency Act (CTA) was enacted on January 1, 2021, as part of the Anti-Money Laundering Act of 2020 in the National Defense Authorization Act and went into effect on January 1, 2024.

What is the CTA?

The CTA was enacted to combat money laundering and terrorism and to create a central register of business ownership information to assist with these combative efforts. The Act requires any qualifying entity to report information to the Financial Crimes Enforcement Network (FinCEN) about itself, each of its qualifying beneficial owners, and for any recently created entity, its company applicants.

For entities created or registered to do business in the United States before January 1, 2024, the CTA filing is due by December 31, 2024. Newly created or registered entities created in 2024 have 90 calendar days to file after notice that their company’s creation or registration is effective. For instance, if you formed a new limited liability company with the Wisconsin Department of Financial Institutions in 2024, your CTA filing is likely due 90 days after filing the articles of organization, unless the entity meets certain exemptions.

Under the CTA, many entities will be required to report the identity and certain personal information of: