New Federal Reporting Requirements for LLCs and Corporations

Decorative image that features a megaphone and the text "Corporate Transparency Act" and "What Business Owners Need to Know"If you have an LLC, corporation, or other entity registered through the Maine Secretary of State, you’ll want to know about your obligations under the federal Corporate Transparency Act.

On January 1, 2024 the Corporate Transparency Act went into effect requiring millions of small businesses to register with the US Treasury’s Financial Crimes and Enforcement Network (FinCen).

What is the Corporate Transparency Act?

The Corporate Transparency Act (CTA) was enacted by Congress in 2021. The intent of the law is to make it easier to identify individuals behind illegal activities like money laundering, fraud, or the financing of terrorism when conducted through shell companies or opaque ownership structures.  The law requires that all “beneficial owners” of entities created through a state secretary of state office, register with FinCen, the Financial Crimes Enforcement Network of the U.S. Treasury.

Do you need to register your business?

Entities that need to report include businesses registered as “a corporation, a limited liability company (LLC), or an entity that was otherwise created in the United States by filing a document with a secretary of state or any similar office under the law of a state or Indian tribe; or a foreign company and was registered to do business in any U.S. state or Indian tribe by such a filing.”  

Who does NOT need to register?

There are 23 exceptions under the law.  Most exceptions are for publicly traded companies, financial institutions, charitable nonprofit organizations, and large operating companies. These types of businesses typically have other reporting requirements that make their beneficial owner information available to those who need it. 

If you operate as a sole proprietor or partnership without a legal structure like an LLC, you do not need to register.  Some inactive entities may also not need to register.  

Who is a beneficial owner or company applicant?

A beneficial owner is an individual who owns or controls at least 25 percent of a company OR has “substantial control” over the company such as the president, financial director, member, general manager, etc.   For more specific information and definitions, refer to the FinCen’s FAQ page.

For entities created in 2024 or later, the company applicant must also register. A company applicant is an individual who directly files or is primarily responsible for the filing of the document that creates or registers the company. 

When do you need to register?

If your company was created or registered prior to January 1, 2024, you will have until January 1, 2025, to report. If your company was created or registered on or after January 1, 2024, and before January 1, 2025, you must report beneficial owners and company applicants within 90 calendar days after receiving actual or public notice that your company’s creation or registration is effective. If your company was created or registered on or after January 1, 2025, you must file beneficial owners and company applicants within 30 calendar days after receiving actual or public notice that its creation or registration is effective. 

Any updates or corrections to beneficial ownership information that you previously filed with FinCEN must be submitted within 30 days.

How will your information be used?

Your information will be stored in a secure database that is not accessible to the public. FinCEN will allow Federal, State, local, and Tribal officials, as well as certain foreign officials who submit a request through a U.S. Federal government agency, to obtain beneficial ownership information for authorized activities related to national security, intelligence, and law enforcement. With the consent of FinCen, financial institutions may also request information in certain circumstances.

Where do you register?

Reporting companies will have to report beneficial ownership information electronically through FinCEN’s website:  The system will provide the filer with a confirmation of receipt once a completed report is filed.  It is free to register with FinCen and should only take a few minutes. Most business owners should be able to do this themselves and not need to pay a third party for this service.

What information do you need to register?

To register, beneficial owners will need to provide their name, address, and date of birth.  They will also need to upload a picture identification such as an non-expired passport or state drivers license, or other non-expired state picture ID. Non-expired passports from foreign countries are  acceptable if no other identification is available.

Beware of Fraud

Unfortunately, fraudulent attempts have already been made to obtain personal information from small business owners.  Do not click on any link or QR code sent to you in an email from an unknown address.  Many of these emails use wording such as “important compliance notice.”

The FinCen website for reporting beneficial ownership information has many resources for you to understand your reporting obligations.  Go directly to to learn more.