Overview of the Corporate Transparency Act

The Corporate Transparency Act (CTA) is a significant legislative measure aimed at enhancing transparency in business ownership and combating illicit activities such as money laundering and tax evasion. Enforced by the Financial Crimes Enforcement Network (FinCEN), the CTA mandates that certain entities, referred to as reporting companies, disclose information about their business and beneficial owners. This legislation will apply to millions of businesses, with estimates suggesting it will affect 32.6 million businesses in 2024 alone. However, the CTA faces controversy due to its extensive reporting requirements and the associated penalties for non-compliance, which can include substantial fines and even imprisonment.