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The Corporate Transparency Act (CTA), enacted in 2021, mandates that certain companies report key information about their beneficial owners to the U.S. Department of the Treasury's Financial Crimes Enforcement Network (FinCEN). This is part of an effort to combat illicit activities like money laundering and terrorism financing by increasing transparency in business ownership.
Unfortunately, the law is written in such a way that this law covers Cooperative and Condominium Board members and must file accordingly. This was recently challenged in Court, but the Court would not grant an injunction to prevent Cooperative and Condominium Board members from filing. The filing deadline is January 1, 2025, which is fast approaching.
LINK HERE:
https://cooperatornews.com/article/court-foils-attempt-to-block-corporate-transparency-act?utm_source=newsletter915&utm_medium=email&utm_campaign=newsletter&npe=n915-1003596
Here are some key provisions of the CTA:
1. Beneficial Ownership Reporting: Companies covered by the CTA must report beneficial ownership information, including the names, dates of birth, addresses, and identification numbers (e.g., passport or driver’s license numbers) of individuals with substantial control or ownership of the company. As of this writing, Cooperative and Condominium Board Members are covered under this law and must provide this information.
2. Covered and Exempt Entities: The CTA generally applies to smaller, privately-held corporations, limited liability companies, and similar entities. However, it exempts certain types of organizations, such as publicly traded companies, banks, credit unions, larger firms (with more than 20 employees and $5 million in gross receipts), and certain regulated entities. Cooperative corporations and condominiums are considered covered entities and must comply.
3. Filing Deadlines-You have until January 1, 2025 to comply.
3 Penalties for Non-Compliance: Failure to report or provide false information can result in civil penalties and criminal charges, including fines of up to $500 per day for non-compliance and, in some cases, imprisonment.
In light of this large fine, it is imperative that your Board consult with the Management; Attorney, and/or accountant to figure out the best way to proceed and comply with this new regulation.
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