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Beneficial Ownership Reporting - New Federal Requirement to be completed by Jan 1, 2025

The following letter provides information on the new reporting requirements as part of the Corporate Transparency Act (CTA) that was enacted on January 1, 2021.

The CTA authorizes the Financial Crimes Enforcement Network (FinCEN), a bureau of the US Treasury Department to collect certain business information as a means of addressing and guarding against money laundering, terrorism financing, and other forms of illegal financing. 

FinCEN is interested in obtaining “beneficial owner” information from companies required to report. An overview brochure can be found here:


What companies are subject to the reporting requirements?

According to the Small Entity Compliance Guide a reporting company includes:

- Corporations

- Limited Liability Companies (LLCs) of any taxation – single members LLCs, S Corps, and Partnerships

- Or other companies created by filing paperwork with a secretary of state or similar government official

There are a handful of exempt companies that are already subject to other reporting requirements. The list includes banks, investment firms, accounting firms, nonprofits, etc.

Who is considered a “beneficial owner” of a reporting company?

            A beneficial owner is any individual, who directly or indirectly, exercises substantial control or owns or controls at least 25 percent of the company’s ownership interests.

Substantial control looks like when an individual:

- Serves as a senior officer of the company (President, CEO, CFO, Vice President, etc.)

- Has authority over the appointment of other senior officers or members of the board

- Directs, determines, or has significant control over important decisions made by the reporting company

In the case of CTA reporting, senior officials with decision making control over the reporting company are considered beneficial owners even if they don’t have an equity interest in the company. Beneficial ownership is understood in a much broader sense than traditional tax considerations of owners or shareholders reported on the business tax return.

When is the reporting deadline?

- For existing Reporting Companies** – the deadline is January 1, 2025 (the reporting window opened January 1, 2024)

- For new Reporting Companies*** (formed after January 1, 2024) – the deadline is 90 days from formation or registration

**Existing Reporting Companies – created with the Secretary of State prior to January 1, 2024. If you’ve been in business for a while, this is you.

***New Reporting Companies – if you filed with the Secretary of State on or after January 1, 2024. If you’re new to business, this is you.

FAQS for CTA Reporting:

Q: Is my company subject to the CTA reporting requirements?

A: Most likely. Even single member LLCs fall into the CTA reporting requirements and need to report beneficial ownership information.

Q: How do I determine ownership interests of beneficial owners?

A: Businesses with simple capital structures can use tax reporting ownership interests and the substantial control test to determine what beneficial owners need to be reported. Companies with more complicated ownership structures should assess and determine each personal who exercises substantial control over the reporting company, even if they do not have an equity interest.

Q: What information is reported to FinCEN?

A: Owner’s legal name, residential address, date of birth, and legal identifier number from a non-expired passport, driver’s license, or state identification card. The image of the non-expired photo ID is required. Additionally, business information like name, EIN, mailing address, etc. will be required.

Q: Is my accountant or my lawyer considered a beneficial owner?

A: In most cases where an accountant or lawyer are providing arm’s length advice to the reporting company and its owners, the third-party professional is NOT considered to excise substantial control over the company, even if the accountant or lawyer is designated as a registered or reporting agent on the reporting paperwork filed with the IRS and or Secretary of State.


What are my next steps, and how is Quill & Keyboard Accounting going to help my business meet my reporting requirements?

To ease the reporting burden and learning curve on individual and business tax and accounting clients, I am willing to undertake the following for you:

- Determine your reporting requirement

- Determine your beneficial owners

- Timely file your CTA prior to January 1, 2025 or within 90 days of formation for new businesses


To do this I will need the following information from you:

- Clear image of your unexpired driver’s license, passport, or state issued identification card sent via email to


Given the volume of filings and importance to adhere to the reporting requirements, the following fees will be assessed:

- $25 for single beneficial owners

- $40 for two-four beneficial owners

- $65 for five-nine beneficial owners

- $175+ for ten or more beneficial owners


Please let me know as soon as possible if you would like me to take care of the filing process for you.




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