On January 1, 2021, Congress passed the Corporate Transparency Act (“CTA”). The CTA will become effective on January 1, 2022. The CTA will require certain U.S. “reporting companies” (including LLCs) to disclose to the U.S. Department of Treasury’s Financial Crimes Enforcement Network (FinCEN), information on their (i) “beneficial owners” and (ii) individuals involved in forming or registering the companies.
Under the CTA, a “beneficial owner” is defined as an individual who, directly or indirectly through any contract, arrangement or otherwise, exercises substantial control over an entity or owns or controls at least 25% of an entity’s ownership interests.
By McLaughlin & Stern LLP.