What this is: New York enacted the LLC Transparency Act in December 2023 and amended it in March 2024. The Act impacts limited liability companies (LLCs) formed or qualified to do business in New York.
What this means: LLCs formed or qualified to do business in New York will need to report their “beneficial ownership” information to the New York Department of State (DOS).
On December 22, 2023, New York Governor Kathy Hochul signed S.995B/A.3484, the LLC Transparency Act (“the Act”), into law. The Act was amended on March 1, 2024 and takes effect on January 1, 2026. The Act requires both domestic and foreign qualified LLCs to file a Beneficial Ownership Information (BOI) report with the New York DOS disclosing the names of each LLC’s “beneficial owners” and other information. Reporting deadlines vary as described below. The DOS will store the BOI in a non-public database available to law enforcement and other government agencies under certain circumstances. The Act’s definition of “beneficial owners” and some other key terms mirrors the language of the federal Corporate Transparency Act and its implementing regulations (collectively, the “CTA”). Let’s examine some key details of the Act as it compares to the CTA.
Key Terms
The Act states that the term “beneficial owner” shall have the same meaning as that term is defined in the CTA. Specifically, a “beneficial owner” is any individual who, directly or indirectly, either exercises substantial control over the LLC or owns or controls at least 25% of its ownership interests. The Act also states that the term “reporting company” has the same meaning as the CTA’s definition, except that it only includes LLCs (both domestic and foreign), and not the other entity types included in the CTA. The term “company applicant” also has the same meaning under the Act as the CTA’s definition. “Exempt company” under the Act means an LLC that meets the requirements for one or more of the 23 exemptions enumerated under the CTA.
Content of Beneficial Ownership Disclosure
The BOI report filed with the DOS must contain the following information about the LLC’s beneficial owners: The individual’s name, date of birth, address and unique identifying number from an acceptable identification document. This is the same information about each beneficial owner that is required in the CTA’s BOI report, except that (a.) the address of each beneficial owner can be the individual’s business address, rather than their residential address as is required by the CTA and (b.) unlike the CTA, the Act does not require a scanned image of each beneficial owner’s unique identifying document. In addition, the Act originally did not include the CTA’s requirement that certain reporting companies provide information about their "Company Applicants;" that is, specific individuals involved in forming the reporting company, as defined in the CTA. However, the March 2024 amendments to the Act added the requirement that the BOI reports contain company applicant information. The Act requires all reporting LLCs to include the names and addresses of their company applicants, regardless of when the LLC was formed or registered. The CTA, in contrast, recognized that it would be burdensome and sometimes impossible for a reporting company formed prior to the CTA’s effective date to uncover the names and addresses of the company applicants who formed or registered the reporting company. Therefore, the CTA only requires company applicant information for reporting companies formed on or after January 1, 2024.
Finally, the Act does not allow the use of FinCEN identifiers in lieu of providing a beneficial owner’s or company applicant’s name and address on the BOI report.
Exemptions and Exemption Filings
The Act provides for the same 23 exemptions to the BOI reporting requirements as does the CTA. Unlike the CTA, which does not require exempt reporting companies to make an exemption filing, the Act requires reporting companies claiming exemptions to submit a filing certifying that the entity is exempt.
If you still have questions, stop by our Corporate Transparency Act resource center and have a look around for informative articles, webinars and even a CTA Exemption wizard.
Due Dates for Beneficial Ownership Disclosure
For non-exempt domestic LLCs formed on or after January 1, 2026, the LLC must file its BOI report within 30 days of formation.
For non-exempt domestic LLCs formed prior to January 1, 2026, the LLC must file its BOI report no later than January 1, 2027.
For non-exempt foreign LLCs registered to do business in New York on or after January 1, 2026, the LLC must file its BOI report within 30 days of filing its application for authority to transact business.
For non-exempt foreign LLCs registered prior to January 1, 2026, the LLC must file its BOI report no later than January 1, 2027.
After filing an initial BOI report, the Act requires all reporting LLCs to file an annual statement either confirming or updating the information in the initial report. This differs from the CTA, which does not have an annual reporting requirement. Rather, the CTA only requires updates to the initial BOI report if there are subsequent changes to the beneficial owner and/or reporting company information.
Forms
The DOS has indicated that BOI reports and exemption filings will be submitted electronically.
Accessibility and Confidentiality
The Secretary of State will store the BOI in a database and make some of the BOI available to the public via its website, including information about the LLC itself, as well as the full legal name of its beneficial owners. Other information contained in a BOI report, including certain personal identifying information (“PII”) about the beneficial owners, is to be kept private and available only to law enforcement or in conjunction with a court order. In addition, under certain circumstances, a beneficial owner may apply for a waiver to withhold their PII.
Penalties for Non-Compliance
Both the CTA and the Act impose penalties for non-compliance, but those penalties differ. Under the Act, non-exempt LLCs that are non-compliant with the BOI reporting requirements will be suspended and unable to conduct business in New York until after coming into compliance. The New York DOS’s records will show an LLC to be past due if it is non-compliant for more than 30 days; LLCs that are non-compliant for more than 2 years will be marked as delinquent in the DOS’s records. To remove the delinquency, the non-compliant LLC must pay a $250 civil penalty and file an up-to-date BOI report, as well as pay any outstanding fines to the Attorney General, who can impose fines of up to $500 per day. The Attorney General can also dissolve an LLC or revoke its authority to do business in New York for failure to file either a BOI report or exemption attestation or for providing or attempting to provide false or fraudulent information. The CTA imposes both civil and criminal penalties for willful non-compliance.
Bear in mind that non-exempt LLCs formed or doing business in New York must comply with both the CTA and the Act, not one or the other.
For further information on the CTA, please see our CTA Resources Page.
This content is provided for informational purposes only and should not be considered, or relied upon, as legal advice.
