#66: Understanding The Corporate Transparency Act
Download MP3In this episode, titled "Understanding The Corporate Transparency Act," the Teaching Tax Flow podcast hosts, Chris Picciurro and John Tripolsky, along with expert guest Jeff Hampton, dive into the intricacies of the newly enacted Corporate Transparency Act (CTA). This conversation is a must-listen for businesses and investors keen on remaining compliant with the latest federal laws that aim to curb money laundering through increased transparency.
The podcast provides a rich discussion on the implications of the CTA on small businesses and investors, focusing particularly on entities formed before and after January 1, 2024. The dialogue lays out what the law expects, emphasizing the importance of identifying beneficial owners and the type of entities affected. With ongoing updates from the federal government, the episode serves as an essential guide for staying abreast of compliance requirements without panic.
Key Takeaways:
- The Corporate Transparency Act aims to combat money laundering by monitoring small companies with less than $5 million in gross receipts or 20 or fewer employees.
- Entities formed before January 1, 2024, have until January 1, 2025, to comply with the CTA, while new entities formed after that date have a 90-day compliance window.
- "Beneficial ownership" is defined as individuals having at least 25% ownership or exercising substantial control over a reporting company.
- Trusts, especially revocable and irrevocable ones, are currently not considered reporting companies under the CTA unless they meet specific business purposes.
- It's essential to work with professional advisors to stay current with CTA regulations and ensure long-term compliance without making knee-jerk reactions to changes.
Notable Quotes:
- "This is just another one of those things we just got to get in line with. If you're going to be an investor and you're going to have LLCs or run a business." - Jeff Hampton
- "One of the things to do is to be in touch with your advisors who know the direction of this and are working with investors every day to make sure this is in place." - Jeff Hampton
- "Don't just go rush into this right now. Let's let the dust settle just a little bit." - Jeff Hampton
- "It's the last thing we need, but whether we like it or not, we've got more compliance." - Jeff Hampton
Resources:
www.teachingtaxflow.com/cta
Episode Sponsor:
Strategic Associates, LLC
Roger Roundy
www.linkedin.com/in/roger-roundy-86887b23
Episode Sponsor:
Strategic Associates, LLC
Roger Roundy
www.linkedin.com/in/roger-roundy-86887b23
