10 TIPS AND THOUGHTS ABOUT THE CTA

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4) DESPITE #3 ABOVE, I ENCOURAGE YOU COMPLY WITH THE CTA AND FILE YOUR BENEFICIAL OWNERSHIP REPORTS SOONER, RATHER THAN LATER

For most companies, the reporting requirements are NOT going to be the end of the world. People may not like the requirements, but this is one of those cases where (in my opinion), it's easier to comply, file your reports and be done with it. I encourage you to file, sooner, rather than later. Don't wait for the deadline. Get it done and get it over with.

5) WHEN IN DOUBT ABOUT WHETHER OR NOT YOU ARE REQUIRED TO FILE, GO AHEAD AND FILE ANYWAY

You can't go wrong by filing when you "technically" might not have been required to. There are no penalties or consequences or filing when you might not have been required to.

On the other hand, the penalties and consequences FOR NOT FILING when you are required to are massive. Don't take the chance. If you're not sure whether or not your company qualifies for an exemption. file anyway. If you're not sure whether or not a particular person is a beneficial owner, file anyway. That way you know that you're "covered".

6) ENCOURAGE THE BENEFICIAL OWNERS OF YOUR COMPANY TO GET THEIR OWN FINCEN IDENTIFIER NUMBER

This puts the responsibility for updating the information and documents on the beneficial owner and NOT on the entity. The entity is still responsible for making sure the beneficial owner updates their information, but it will be owner who updates the information and NOT the entity.

Also, if the beneficial owner is involved in more than one entity, the simple act of updating their own personal FinCEN Identifier information will update that information on all of the entities.

7) CONSIDER USING A THIRD PARTY PROVIDER TO ASSIST YOU WITH YOUR FILINGS

For many of the entities, filing will be relatively easy.

For many of the entities, it won't be.

Like the IRS tax code, this law is complicated and it has lots of areas that can be confusing.

If you want help or need help, we're here to help.

8) IF YOU ARE IN THE BUSINESS OF HELPING OTHERS FORM THEIR LLCS, PARTNERSHIPS, CORPATIONS, ETC, GET YOUR OWN FINCEN IDENTIFIER NUMBER ASAP

As of Jan 1, 2024. you are going to have to report yourself as a Company Applicant if you are in the business of assisting others in the formation of their entities. Unless you want to be giving your clients your own personal information and a copy of your driver's license or passport, I encourage you to get your own individual FinCEN Identifier number ASAP.

9) IF YOU HAVE ASSISTED PREVIOUS CLIENTS IN THE FORMATION OF THEIR ENTITIES, I RECOMMEND YOU NOTIFY THEM ASAP, IN WRITING ABOUT THIS NEW LAW

Although you may no longer be representing those previous clients, it would be prudent for you (to the extent possible) to notify your old clients about this law, in writing. In that notification, you may want to tell them that you are NOT representing them for purposes of complying with that new law, as it was not in place at the time you represented them, You may also want to tell them you are available to assist them, if they want you to and if you want to take on that work. We can also assist you and your former clients in meeting their reporting responsibilities, if you need help.

10) WHILE THIS NEW LAW IS BAD, IT'S NOT THAT BAD

Again, this is my opinion. This new law is going to be one of those areas where many people spend hours and hours and hours telling you why they don't have one or two hours to simply comply with the filing requirements and be done with it.

Is it a pain? - Yes

Is it a new burden? - Yes

Is it easier to simply get the filing over with and be done with it? - Yes