Bass, Berry & Sims attorney Riney Green provided insight on the Corporate Transparency Act (CTA) for an article in Corporate Compliance Insights examining the top compliance, risk and governance stories of 2023.
Speaking about the upcoming 2024 reporting deadline for CTA, Riney said, “There was some wishful thinking that Congress would intervene and either repeal the CTA or delay its effective date. And FinCEN didn’t provide practical explanatory guidance until September 2023, although the law was enacted in late 2020.”
Riney added, “For the average ‘mom and pop’ business with one or two owners, [reporting] will be a nuisance but not a hardship. However, for modest-sized companies with [$2 million to $5 million] of annual revenues and multiple owners, it could be a major headache. Those companies must not only disclose their 25% owners; they will also be required to subjectively determine if any key employees involved in the management of the business exercise ‘substantial control’ of the company. And not everyone will be excited to provide a copy of their driver’s license to the federal government, even though all the CTA filings are by law required to be non-public and confidential.”
The full article, “A Look Back: Top Stories of 2023,” was published by Corporate Compliance Insights on December 20 and is available online. In addition to Riney’s comments about the CTA, Bass, Berry & Sims attorneys Thad McBride and Roy Wyman were also quoted in the article. Thad spoke about the impact of Russian sanctions and Roy spoke about the myriad of state data privacy laws, also important top stories this past year.