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Corporate Transparency Act
Congress wants to make it easier for the federal government to crack down on shell companies used for money laundering, trafficking, terrorism or other illegal activity. Although optometry practices are not involved in such activities, many optometry practices will be required to report information about their ownership to the U.S. Department of the Treasury by the end of 2024.
The AOA has created a compliance manual and FAQs for members subject to this reporting burden. Meanwhile, the AOA continues to work with other health care provider organizations and associations of small and independent businesses to relieve the burden associated with this new law, including how best for Congress or the Department of the Treasury to exempt health care practices. The federal government estimates 30 million companies will be required to report.
The Corporate Transparency Act (CTA) was enacted by Congress in 2021, as part of the Anti-Money Laundering Act. This legislation was part of the National Defense Authorization Act.
Small, privately owned businesses, corporations, limited liability companies, limited partnerships, and other entities created by submitting documentation to a state entity such as a secretary of state, are subject to the law. Sole proprietors might not be subject to reporting, if they were not created by submitting documentation to such a state entity.
There are exceptions for tax-exempt nonprofit organizations, and for companies with more than 20 employees and more than $5 million in annual receipts.
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