INDIANAPOLIS — The new federal Corporate Transparency Act kicked off this year.
Attorney Justin Hays with Church Church Hittle & Antrim said since the Financial Crimes Enforcement Network began accepting reports, news about it has been making waves on social media.
"TikTok, Twitter," Hays said, "it's prompted clients to seek us out."
The federal law aims to increase transparency and curb financial crimes. That means telling Uncle Sam if you are a beneficial owner of a business.
"A beneficial owner is an individual who owns a 25% ownership interest in the entity, or someone who exerts substantial control over the decision making for the company," Hays said.
Small business owners also need to worry about this reporting.
"Anyone who owns a rental property through an LLC, a side hustle through an LLC," Hays said, "if they have an entity, unless a specific exemption applies, they will be required to file this report."
Exemptions include nonprofits and businesses that already report this information, including banks and insurance companies.
For a one-man band type, Hays said this filing can take you about 15 minutes. For larger businesses, it can be a more involved project.
There is no fee to file.
If you willingly fail to file, you can face fines of up to $500 per day, or two years of imprisonment.
These are the deadlines, according to their site:
"A reporting company created or registered to do business before January 1, 2024, will have until January 1, 2025 to file its initial beneficial ownership information report."
A reporting company created or registered on or after January 1, 2024, and before January 1, 2025, will have 90 calendar days after receiving notice of the company’s creation or registration to file its initial BOI report.
This 90-calendar day deadline runs from the time the company receives actual notice that its creation or registration is effective, or after a secretary of state or similar office first provides public notice of its creation or registration, whichever is earlier.
Reporting companies created or registered on or after January 1, 2025, will have 30 calendar days from actual or public notice that the company’s creation or registration is effective to file their initial BOI reports with FinCEN."