By now, you've probably heard about the Corporate Transparency Act. If you haven't, it's a law that impacts nearly every non-publicly traded company in America. It requires that businesses disclose information on 25% or more owners of the business or those who have control over the business, such as key decision-makers and senior officers.
This article explains how owners and key decision-makers can keep their personal information secure while also ensuring the businesses they are involved with comply with the law. Business owners should educate themselves on the Corporate Transparency Act and make sure they know how to file the report (or hire someone to do it for them).
Do I have to provide my personal information?
The quick answer: Yes.
The longer answer: Yes, but not to the businesses you are affiliated with if you don't want to.
With the number of scams out there, keeping your information private and secure is one of the most important things you can do. Especially via email, which is the method we suspect most businesses will use when transmitting information related to the Corporate Transparency Act.
So, how do you protect your information and still comply with the law?
Enter the FinCEN ID!
What is a FinCEN ID?
I'm extremely happy the Treasury did this. They created a way for individuals to comply with the law while keeping their information private from those requesting it.
Individuals can apply for a FinCEN ID directly with the treasury and obtain a FinCEN ID. Then, when businesses they are affiliated with request their information, they can simply reply back, "Hey there, actually, I have a FinCEN ID that you can use instead! Here's the number..."
Amazing right? And the best part? It takes less than 5 minutes to obtain it.
Steps to obtaining a FinCEN ID
I cannot begin to tell you the peace of mind I have knowing that I can give out my FinCEN ID instead of a copy of my driver's license or passport to others. Let's walk through the steps to obtain your own FinCEN ID.
- Go to https://fincenid.fincen.gov/
- Sign in with your login.gov account
- If you access your IRS tax account online, you already have a login.gov account.
- If you don't have a login.gov account, that's okay! Take a few moments and create one, it's becoming the required standard to interact with the federal government online.
- You'll be asked to provide the following information:
- Full legal name
- A digital copy of your government-issued identification (I used my passport, but a driver's license works too)
- If there are no errors, you'll receive your FinCEN ID immediately!
- Make sure to download a PDF copy and store it with your other important records.
- Provide your FinCEN ID to those who ask for your information to comply with the law.
The bottom line
Obtaining a FinCEN ID is a smooth, secure process that helps you comply with the Corporate Transparency Act and protects your sensitive personal data. Using a FinCEN ID means you no longer need to share your private information, like your driver's license or passport number, with every entity. Instead, this single ID acts as a safeguard, ensuring your compliance with the law while preserving your privacy. Remember, in a world where data breaches are all too common, taking this small step could significantly reduce your vulnerability to identity theft and unauthorized data exposure.
Our team of experts will be more than happy to help you navigate the CTA reporting requirements and other business needs like tax compliance and bookkeeping. Schedule a call and let us know how we can make your life easier.