Through the CTA, the U.S. Treasury Department (Treasury) hopes to reduce money laundering and other illegal flow of funds otherwise hidden through entities used for various investment and financial transactions. Within the Treasury crosshairs is the ubiquitous real estate holding company.

The large operating company exception appears straightforward at first. Entities are exempt if they meet a specific set of criteria. Easy enough, right? Not so fast.

The Financial Crimes Enforcement Network (FinCEN) has recently issued detailed guidance on the reporting obligations for dissolved entities under the Corporate Transparency Act (CTA).

It is important to remain vigilant about compliance with the Corporate Transparency Act and getting an entity’s BOIR report filed in a timely manner.

On March 26, 2024, Miller Johnson filed a lawsuit challenging the constitutionality of the federal Corporate Transparency Act (CTA). Miller Johnson represents the Small Business Association of Michigan, the Chaldean Chamber of Commerce, Steward Media Group, LLC, Power Connections Co, LLC, Derek Dickow, Semper Real Estate Advisors, LLC, and Timothy Eisenbraun.

The Corporate Transparency Act, enacted on January 1, 2021 and effective January 1, 2024, directs the U.S. Department of the Treasury’s Financial Crimes Enforcement Network to establish a nationwide database of beneficial ownership of certain corporations and other legal entities.

As we announced at the end of 2023, the Corporate Transparency Act (CTA) went into effect January 1, 2024.  The seminal purpose of the CTA is to give the U.S. Financial Crimes Enforcement Network an additional tool to prevent money laundering, financial crimes, and related illegal activity in the U.S.’s financial system that are conducted through the veil of one or more entities.

A major change in federal law will impact tens of millions of existing and new entities starting on January 1, 2024.  This new law is called the Corporate Transparency Act (or “CTA”) and will implement a broad regime of disclosure and transparency designed to reveal entity owners and non-owners who have a certain degree of decision-making authority over the entity.

This alert expands on the exemptions to the definition of a “Reporting Company” which effectively removes an entity from compliance obligations.

Heading into the home stretch of 2024, have you assessed whether the Corporate Transparency Act (CTA) applies to your entit(ies)?  If you are unsure whether or how to comply with this sweeping and confusing new federal law, Miller Johnson invites you to contact our CTA Taskforce.

On 10/29/2024, FinCEN extended the deadline for victims of Hurricane Helene to submit benefit ownership information (“BOI”) reports.