The Corporate Transparency Act (CTA) introduces beneficial ownership reporting requirements for most U.S. businesses. However, not all companies are required to file. Some types of entities qualify for exemptions under the Act. Let’s explore which businesses are exempt and why.
Exempt Entities Under the CTA
FinCEN has identified 23 categories of exempt businesses that do not need to file a Beneficial Ownership Information Report (BOIR). Some examples of exempt entities include:
- Publicly traded companies that report to the SEC,
- Banks and credit unions,
- Insurance companies,
- Nonprofits and tax-exempt entities,
- Large operating companies with over 20 employees, more than $5 million in revenue, and a physical presence in the U.S.
Why Are These Businesses Exempt?
These entities are already subject to federal regulations and reporting requirements that provide the transparency the CTA aims to establish. For example, publicly traded companies must already disclose detailed information about their ownership structure through the SEC, while banks are heavily regulated by financial oversight agencies.
How to Know If You Qualify for an Exemption
Determining if your business qualifies for an exemption can be complex, but you don’t have to navigate this alone. At BOIR Reporting Service, we can help you determine whether your company is exempt and ensure you meet any other applicable compliance requirements.
Stay Informed
Even if your business qualifies for an exemption, it’s important to stay informed about the evolving regulations. For businesses that don’t qualify, BOIR Reporting Service provides an easy and accurate way to submit your beneficial ownership report on time.