Corporate Transparency Act (CTA) Exemptions

What are CTA Exemptions?

CTA exemptions refer to organizations that are not required to file beneficial ownership reports with FinCEN. These exemptions were designed to reduce unnecessary burdens on entities that are already subject to rigorous regulatory oversight or pose minimal risk of being used for financial crimes.

Key Exemptions Under the Corporate Transparency Act

Entities exempt from CTA reporting include:

  1. Large Operating Companies

    • Employ more than 20 full-time employees in the U.S.

    • Report more than $5 million in annual gross receipts or sales

    • Maintain a physical office in the U.S.

  2. Public Companies

    • Companies registered with the Securities and Exchange Commission (SEC).

  3. Banks and Credit Unions

    • Already regulated under federal banking laws.

  4. Insurance Companies

    • Entities subject to state insurance regulation.

  5. Accounting and Tax-Exempt Entities

    • Public accounting firms registered with the PCAOB

    • Charitable organizations recognized under section 501(c) of the IRS code

  6. Governmental and Utility Entities

    • Governmental authorities and utilities regulated by government agencies.

  7. Other Regulated Entities

    • Broker-dealers, investment advisers, and venture capital fund advisers registered with the SEC.

    • Pooled investment vehicles managed by exempt entities.

Example of CTA Exemption in Practice

A publicly traded bank is exempt from CTA reporting because it is already subject to strict oversight by the SEC and federal banking regulators. Conversely, a small private LLC with minimal employees and revenue would need to file beneficial ownership information.

CTA Exemptions vs. CTA Reporting Requirements

  • CTA Exemptions – Entities already regulated or deemed low risk are excused from reporting.

  • CTA Reporting Requirements – Smaller, privately held entities must disclose beneficial ownership to FinCEN.

How VComply Can Help

VComply helps organizations navigate CTA compliance by:

  • Maintaining centralized records of beneficial ownership data

  • Automating reporting workflows and document tracking for CTA filings

  • Mapping exemption criteria to company profiles for quick determination

  • Creating audit-ready trails to demonstrate compliance with FinCEN requirements

  • Streamlining governance and compliance processes for both exempt and non-exempt entities

With VComply, businesses can reduce compliance risks, simplify ownership reporting, and ensure accurate exemption determinations under the Corporate Transparency Act.