Corporate Transparency Act – Considerations for Attorneys

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By Herrick Lidstone, Burns, Figa & Will, P.C.

As the federal Corporate Transparency Act is moving toward effectiveness on January 1, 2024, the necessary rules are slow to come.  In mid-September the Financial Crimes Enforcement Network (FinCEN) issued a new interpretation (Small Entity Compliance Guide – Beneficial Ownership Information Reporting Requirements) which provides significant assistance in trying to understand the existing rules and prepare Reporting Companies for their filing obligations or determination that they may be exempt.  The new Guide also provides examples intended to assist in determining where an officer or other person with control is a “Beneficial Owner” for reporting requirements, whether or not holding ownership interests, and how to determine a 25% owner subject to the reporting requirements when there may be several classes of ownership interests (voting and equity, capital, or profits) outstanding.  In his latest paper, Herrick Lidstone has updated an earlier paper significantly to reflect rule changes and interpretations through September and will continue to update the paper as more interpretations (or rules) are issued.  Herrick has attempted to provide some clarity to the CTA requirements.  As the paper says, however, more clarification and rule making, as well as website availability, are needed.

Lidstone, Herrick K., Considerations for Attorneys Resulting from the Corporate Transparency Act, available at https://ssrn.com/abstract=4414393 and will be updated as events dictate.