Corporate Transparency Act Reporting Reinstated – Please Take Action!
December 23, 2024
12/24/24 Edit: A filing extension for businesses established prior to January 1, 2024 has been issued, and those organizations will have until January 13, 2025 to file.
The Federal government appealed their case to the 5th Circuit Court of Appeals and were successful in getting a stay on the injunction against enforcement of the Corporate Transparency Act. Translation: The Corporate Transparency Act (CTA) is back on and small businesses are once again required to report beneficial owners to the FinCEN (a part of the IRS) by December 31, 2024.
Three things to note:
- We have vetted partners to help you with your first filing, which for most small businesses is due by December 31, 2024. Click here to learn more.
- Intentional non-compliance with the law carries up to a 2-year felony penalty plus heavy fines. While we have been shouting about this requirement from the rooftops, we fear that most businesses do not even know this law exists. While there are some exemptions, generally speaking, if your business has 20 or fewer employees or $5 million or less in revenue, you probably have to file. Please visit our numerous resources on our website to familiarize yourself with what is required.
- This is not the end of the story. SBAM has an active challenge against this law here in Michigan and there is a chance that our case could produce a more limited injunction (just for our members who are the plaintiffs) before the end of the year. But with so few days left before the deadline, the risks of waiting to file are increasing. If you are confident in your ability to do so yourself, you can probably afford to wait a little longer. But if you are relying on someone else to do the filing for you, we recommend understanding what your real deadline is.
We are using urgent language here because non-compliance comes with such heavy and serious potential penalties. We are very concerned that literally millions of small businesses across the country do not know of this requirement and the IRS has done little to communicate about it. We cannot say with certainty that the IRS will immediately start looking for violators with criminal prosecutions, but we do expect that late filers will pay fines. Civil penalties are up to $591 per day for each day of non-compliance.
We are committed to continuing our lawsuit against this violation of your 4th amendment rights.
Additional resources can be found here.
Brian Calley, SBAM President & CEO