David Barrett Speaks to Indiana Lawyer About the Corporate Transparency Act

In the article “Corporate transparency: New federal law imposes reporting requirements on some businesses,” Indiana Lawyer discussed the recently enacted Corporate Transparency Act (CTA) and reached out to executive partner David Barrett to provide insight on the topic.

Barrett noted that he felt most large companies in Indiana and nationally were aware of the new law and its possible filing requirements. “I think a lot (of companies) are waiting a little bit,” he said.

Barrett also highlighted that the most likely exemption for businesses included in the law is the “large operating company exemption,” which has a two-part test for U.S.-based companies. They are exempt if they have $5 million or more of U.S.-sourced revenue that is documented by a federal tax return and 20 or more full-time employees in the U.S.

Barrett noted, however, that the new law potentially applies to all companies. Many private companies, family offices, and private equity companies have other entities outside of the main family tree.

Regarding what businesses should be doing now, Barrett said Faegre Drinker has been advising clients that are not exempt to file the new forms sooner rather than later. He shared that there could be a mad rush in the fourth quarter of the year made by businesses that procrastinated. “My number one piece of advice to clients is to try and get out in front of it,” he shared.