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Calling all business owners large and small! Boy, do we sure have news for you. You’ve worked hard to get your business up and running. Congratulations!

Your continued success is why we’re sharing this news with you. Please place your focus on reading this article. Sound the alarms by sharing with all the business owners you know. What we’re about to share with you will affect many, many business owners down the line.

Beginning January 1, 2024, all businesses registered with the Secretary of State are required to adhere to the Corporate Transparency Act. The Corporate Transparency Act carries a high penalty of $500 per day up to a $10,000 fine and/or two years in prison if the requirements as a business owner go unmet.

What is the Corporate Transparency Act?

To put it into the simplest terms, the Corporate Tax Act is a law to identify businesses of whom the owner is unknown. The transparency act was put into place to identify business owners. The law was made to become effective with the Anti-Money Laundering Act of 2020 to prevent financial crimes like terrorism and corruption and tax fraud.

What does this mean for you and your business?

January 1, 2024, all businesses registered with the Secretary of State are required to file a report on behalf of the business with the Secretary of State. Foreign companies doing business in the United States are required to report to FINCEN (Financial Crimes Enforcement Network.)

1. All businesses formed with the Secretary of State in 2023 or prior MUST file an Initial Report on or before January 1, 2025.

2. All businesses filed on or after 2024 will have 30 days to file the report.

3. Non-profits and 501c3’s are exempt from filing.

What sort of information is the report going to ask for?

This report will help to identify the true owner and/or beneficial owner. It will ask for basic company information such as the EIN number, in addition to a copy of your driver’s license, state of registration, etc. This information must be updated on a regular basis as needed.

There are no extensions available at this time. The corporate transparency act is expected to have an impact on thousands of businesses. Make sure yours is not one of them by being prepared. Please share all questions and/or concerns down in the comments below.