A new federal law requires many small businesses — including Notary businesses — to file information with the government by January 2025 or face steep fines and penalties. Read our FAQ about the Corporate Transparency Act below to find out if your business is affected and how to file your information.
What is the CTA and who does it affect?
The Corporate Transparency Act (CTA), enacted in 2021, aims to combat financial crimes by increasing transparency around company ownership. Notaries who have organized and are operating their businesses under certain business structures need to be aware of new filing requirements that may impact their business. The required reporting period started this year, with upcoming deadlines in January 2025.
The CTA requires certain businesses to report information about their “beneficial owners” to the Financial Crimes Enforcement Network (FinCEN). A beneficial owner is someone who owns a significant share of the company or has control over its decisions.
Are Notaries required to report business information under the CTA?
It depends. Notaries who operate as sole proprietorships likely are not affected, unless they filed paperwork with a state office to establish their business. However, Notaries who operate as Limited Liability Companies (LLCs), corporations, or under any other business structure requiring filing with the state are considered reporting companies and must file a Beneficial Ownership Information (BOI) report with FinCEN.
What information do I need to file for my Notary business?
The BOI report requires details about the reporting company, its beneficial owners, and any company applicants (if applicable). This includes names, addresses, birthdays, and identification numbers for each individual.
A “company applicant” includes the person who filed the document that created or registered the company, or the individual responsible for directing or controlling the filing of documents that initially created or registered the business.
What are the deadlines to file?
The deadlines depend on the date the business was established:
- Businesses established before January 1, 2024 have until January 1, 2025, to file their initial BOI report.
- Businesses established in 2024 have 90 days to file after receiving notice of their formation.
- Businesses established on or after January 1, 2025 have 30 days to file after receiving notice of their formation.
What are the penalties for businesses that don’t file?
Failure to comply with the CTA can result in hefty fines. Willful violation can lead to civil penalties of up to $591 per day (as of April 18, 2024) and potential criminal penalties of up to two years imprisonment and a $10,000 fine.
What should I do if I’m not sure my Notary business falls under CTA filing requirements?
Notaries unsure about their filing requirements should consult with an accountant or lawyer to determine if their business must file a report under the CTA. There is no penalty for filing a BOI report if you are not required to, so there is no harm in filing anyway if you wish to err on the side of caution.
Remember: The deadline for pre-2024 companies is approaching. Notaries who operate their business as a reporting company should take steps to ensure they are compliant with the CTA.
Additional Resources:
Small Entity Compliance Guide from FinCEN