The Corporate Transparency Act, which will require businesses to report certain ownership information to the U.S. government, will go into effect Jan. 1.
Here are seven things for dentists to know:
1. The Corporate Transparency Act was enacted in 2021 and aims to combat illicit activity relating to U.S. businesses, including tax fraud and money laundering.
2. The law requires certain businesses to submit a Beneficial Ownership Information report to the Department of Treasury's Financial Crimes Enforcement Network.
3. Companies that fall under this requirement include domestic reporting companies, such as LLCs and corporations, and foreign companies that are registered to conduct business in the U.S.
4. Companies that are exempt from the new law include insurers, investment companies and large operating companies.
5. Under the act, beneficial owners include those who own at least 25% of the company's shares, have a major influence on a company's decisions or operations or have control over the company's equity.
6. The details companies are required to report depend on when the company was established. Businesses established after Jan. 1, 2024, must provide information regarding the business, its beneficial owners and its company applicants. Business established before Jan. 1 will not be required to report on company applicants.
7. Companies established before Jan. 1, 2024, will be required to submit their report by Jan. 1, 2025. Companies created between Jan. 1, 2024, and Jan. 1, 2025, are required to file their report within 90 days of either the notice of formation or public announcement, whichever comes first.