If you’re a small business owner and you forget to take care of a new paperwork mandate, you could go to prison for two years.
A bill once introduced by Carolyn Maloney called the Corporate Transparency Act or CTA, is included in the National Defense Authorization Act. That’s the military budget Congress has to pass each year. CTA was passed in January 2021, but it comes into effect now.
Under the premise that they want to catch criminals and terrorists who use corporations and LLCs to conduct illegal activities, the government has imposed more regulations and rules on US companies.
Business entities are being singled out over all of the many things criminals use to commit their crimes.
The act goes after small businesses, not Goldman Sachs, Black Lives Matter, and Facebook but small businesses.
One of the requirements is that small business owners file a new report to the federal government every year to disclose the company’s shareholders. That is something they have to do already for the IRS. So this is double work for them. They have to report to the Financial Crimes Enforcement Network, otherwise known as FinCEN, as if they were criminals.
FinCEN has over 100 pages of regulations they have to know. If they make a mistake or don’t carry through, they pay steep monetary and criminal penalties, possibly including two years in prison.
So they could go to jail for two years for a paperwork mistake.
You can probably find more criminals in government than any small businesses. How do all these politicians make $180,000 a year and retire as millionaires?