If you have an IRA-Owned LLC, be aware that in 2024, you will need to file a Beneficial Ownership Report due to the Corporate Transparency Act (CTA). The Act, established by the Department of Treasury and Financial Crimes Enforcement Network (FinCEN), mandates that these LLCs, formed or registered in the U.S., provide beneficial ownership information starting January 1, 2024. However, it’s important to note that Solo 401(k)s are not subject to this requirement.

What is the Purpose of the Act?

The purpose of the CTA is to thwart illicit activities like money laundering through anonymous entities in the U.S. For IRA-owned LLCs, the IRA holder is recognized as the beneficial owner. You’re required to report identifying information such as legal name, date of birth, address, and identification details (e.g., from passports or driver’s licenses). Non-compliance can lead to severe penalties, including fines and potential imprisonment.  Keep in mind that any fees associated with filing would be paid for by the IRA.

How to File

To file, you must submit the beneficial ownership information electronically through FinCEN’s secure system. This shift highlights the growing regulatory focus on IRA-linked entities, contrasting the unaffected Solo 401(k)s. You can read more HERE

As always, discuss this and any other financial or legal issue with an appropriate professional.  For further guidance on self-directed retirement questions, contact uDirect IRA Services at info@uDirectIRA.com.