New York Follows FinCEN Enacting Beneficial Ownership Information Reporting

On December 22, 2023, New York?s governor signed Senate Bill 995B/Assembly Bill 3484A, enacting the New York LLC Transparency Act (NYLTA). The NYLTA is modeled after the beneficial ownership information (BOI) reporting requirements under the Federal Corporate Transparency Act (CTA) that took effect January 1, 2024.

NYLTA's new LLC reporting requirement will go into effect December 21, 2024, mandating LLCs to disclose personal information about their beneficial owners. LLCs formed before December 21, 2024, must file their NY BOI or NY Statement of Exemption by January 1, 2025. For LLCs formed after December 21, 2024, BOI reports are required at the time of filing the articles of organization or applying to do business in New York.

New York LLCs that meet the definition of a reporting company under the CTA are required to file a BOI Disclosure Statement with the New York Department of State. NYLTA follows the CTA and recognizes the 23 exemptions present. If your LLC was exempt from CTA BOI reporting requirements, your LLC will also be exempt from NYLTA reporting requirements. However, exempt entities are required to file a Statement of Exemption with the New York Department of State indicating which provision of the CTA grants your exemption.

NYLTA requires BOI reports for any beneficial owner who exercises substantial control over the LLC or owns at least 25% of its ownership shares. The BOI reporting must contain the LLC?s beneficial owner?s full legal name, date of birth, and a unique identifying number like a Social Security Number, Driver's License, or passport.

An important difference between the CTA and the NYLTA is the NYLTA allows the NY Secretary of State to maintain a public BOI database on its website. This means the full legal name of each beneficial owner of a reporting LLC will be public. Other personal identifying information of beneficial owners will be deemed confidential except for use by law enforcement or as required to be disclosed by court order. The last important difference between the CTA and NYLTA is that the NYLTA only applies to LLCs. NYLTA does not apply to corporations and other entities like the CTA does.