The Corporate Transparency Act (CTA) legislation introduced beneficial ownership information reporting requirements for new and existing companies which went into effect on January 1, 2024. The goal of this legislation is to prevent corporations to be used for money laundering.
On Tuesday, Dec. 3, 2024, in the case of Texas Top Cop Shop, Inc v. Garland, a federal district court in Texas issued an order granting a nationwide preliminary injunction that: (1) enjoins the CTA, including enforcement of that statute and regulations implementing its beneficial ownership information reporting requirements, and, specifically, (2) stays all deadlines to comply with the CTA’s reporting requirements. The Department of Justice, on behalf of the Department of the Treasury, filed a Notice of Appeal.
Reporting companies can submit a report to the Financial Crimes Enforcement Network (FinCEN) with certain personal information of each beneficial owner and company applicant. A beneficial owner includes any individual who has 25% ownership or exercises substantial control. Newly formed companies are not currently required to file a Beneficial Ownership Information Report (BOIR), but may do so voluntarily.
This reporting can be filed online using this link to the United States Department of Treasury Financial Crimes Enforcement Network (FinCEN). You'll want to have your employer identification (EIN) number on hand as well. You can read our support article here for more information on how to apply for your EIN.
For more information, please visit the BOI FAQ page and the BOI Compliance page.
Third parties mentioned and Fidelity Private Shares LLC are not affiliated. Included are links to websites that are unaffiliated with Fidelity. Fidelity has not been involved in the preparation of the content supplied at the unaffiliated site and does not guarantee or assume any responsibility for its content.
Fidelity does not provide legal or tax advice. The information herein is general in nature and should not be considered legal or tax advice. Consult an attorney or tax professional regarding your specific situation.
Fidelity Private Shares LLC provides cap table management and other administrative services to private companies and their equity compensation plans.
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