What Fresh Hell Can This Be? Beneficial Ownership Reporting and the New York LLC Transparency Act

This is the third part of our three-part series “What Fresh Hell Can This Be?”^[1] about beneficial ownership reporting. In the first part we discussed the Financial Crimes Enforcement Network’s (“FinCEN”) general residential real estate geographic targeting orders (“GTOs”), the Southwest U.S. border GTO, and the soon to be effective non-financed residential real estate reporting regulations.^[2] In the second part we discussed the Corporate Transparency Act (“CTA”) and its Reporting Rules as (being generous) “revised” by the interim final rule (“IFR”) published on March 26, 2025, including changes and issues wrought by the revisions.^[3] We now turn our attention to the New York LLC Transparency Act, a statute whose intent has been thwarted by the IFR’s destruction of the intended scope of the CTA.

The New York LLC Transparency Act: The Basics

New York’s LLC Transparency Act (“Transparency Act”) was the first and to date is the only state statute providing for a state-level beneficial ownership database^[4] akin to that of the CTA.^[5] Narrower in scope than was the CTA, which reached essentially all companies (corporations, LLCs, limited partnerships, etc.) created or qualified to transact business in the United States, the Transparency Act reaches only LLCs.^[6] Under this law, each limited liability company organized in New York that would be treated as a “reporting company” under the CTA^[7] (a “domestic reporting LLC”) is obligated to file a beneficial owner designation (“BOD”) within thirty days of when it files its initial articles of organization.^[8] With respect to LLCs organized outside of New York but applying to transact business in the Empire State^[9] that would be a reporting company under the CTA^[10] (a “foreign reporting LLC” (domestic reporting LLCs and foreign reporting LLCs are, collectively, “reporting LLCs”)) must file a BOD within thirty days of when it files its application for a certificate of authority to transact business in New York. All of these filings will be electronic and made with the New York secretary of state.^[11] In addition, the New York secretary of state is authorized to issue regulations to effect the required BOD filing mechanism.^[12] To date^[13] no regulations have been issued, but the secretary of state has signaled that they will soon be issued.

The Initial Reporting Deadline and Claims of Exemption

As most recently amended, the Transparency Act has an initial effective date of January 1, 2026. Working from that date, the initial filing due dates for a domestic reporting LLC or a foreign reporting LLC are as follows:

Where a reporting LLC believes itself exempt from the Transparency Act’s reach by reason of one of the exemptions from “reporting company” status under the CTA and the Reporting Rules,^[18] it must file a report to that effect, including under which of the CTA’s / Reporting Rules’ exemptions it qualifies;^[19] this submission is made under penalty of perjury.

Updating Obligations

Having filed an initial BOD, an annual update is required. That annual update will require either updates to any information that has changed or a certification that the information of record remains accurate.^[20] This updating obligation includes a new certification from each exempt company as to the exemption upon which it is relying. Unlike the CTA, there is no obligation to file an update simply because of a change as to the reporting LLC’s information or that of any of its beneficial owners.^[21]

Beneficial Owners

The Transparency Act incorporates by reference from the CTA and the Reporting Rules the definitions and principles there employed to determine who is with respect to a reporting LLC a “beneficial owner.”^[22] The problem this incorporation raises for the Transparency Act is discussed below.

Applicants

The Transparency Act requires, as to each reporting LLC, information about the “applicant,” the definition of which is adopted from the CTA.^[23] However, while the CTA did not require that an initial Beneficial Ownership Information Report (“BOIR”) for a company organized before January 1, 2024, report its company applicant,^[24] no such limiting principle applies under the New York law—in other words, all LLCs ever organized in New York (if still in operation) or qualified to transact business (if still qualified) must identify a company applicant. The New York LLC Act became effective in October 1994, so in some instances there will need to be a lookback of thirty-one years to determine who was the applicant(s). Currently, the Transparency Act provides no mechanism of relief for reporting LLCs whose applicants who are no longer with us; it will be rather difficult to submit either a current address or an identifying number from a current driver’s license or passport for a person now deceased. Similar problems will exist as to applicants who cannot be identified or located or who are simply recalcitrant.^[25]

Required Contents of a BOD

Each reporting LLC, in its BOD, is required to set forth as to each beneficial owner and each applicant the following:

• full legal name;
• date of birth;
• current home or business street address;^[26] and
• a unique identifying number from (i) an unexpired passport, (ii) an unexpired state driver’s license, or (iii) an unexpired identification card or document issued by a state or local government agency or tribal authority for the purpose of identification of that individual.^[27]

Consequences of Failure to File

There are a variety of $500 penalties that apply upon failure to file an initial or an annual update report, ranging from per diem fines up to and including dissolution or the cancellation of the certificate of authority to transact business.^[28]

A Few Points of Comparison

Notwithstanding that the Transparency Act adopts by references certain rules and principles from the CTA, there are material differences between the two regimes that may be encapsulated as follows:

The New York City Real Property Transfer Tax Return

In addition to the Transparency Act, New York City’s Department of Finance, in connection with the New York City Real Property Transfer Tax Return (“NYC-RPT”), requires disclosure of two new additional “grantor” and “grantee” types: (1) single-member LLCs and (2) multiple-member LLCs. For any grantor or grantee that is an LLC, the NYC-RPT requires the names of all members of the grantor or grantee, regardless of percentage of ownership interest or level of management control, as well as each member’s Social Security number or employment identification number. According to published reports, the aim of this change was to capture information needed to address tax fraud.^[58]

The IFR-Sourced Inconsistencies Between the Transparency Act and the CTA

As already discussed, the IFR effected significant changes to the system contemplated by the CTA and the Reporting Rules; the Transparency Act, having been drafted well before the IFR, has suffered consequent damage. For example:

Bills to amend the Transparency Act to “de-link” it from certain of the CTA’s definitions and the disconnects identified above have been approved by the New York legislature; whether they will ultimately be enacted into law remains to be seen.^[67] Speaking broadly, the proposals delete the cross-references to the CTA and the related regulations and substitute repetitions of the previously referenced language.

For example, currently the Transparency Act provides that: “‘[r]eporting company’ shall have the same meaning as defined in 31 U.S.C. § 5336(a)(11), as amended, and any regulations promulgated thereunder,” and then goes on to restrict the application to foreign and domestic LLCs.^[68] The proposed amendment to the Transparency Act would rewrite that definition to provide that a reporting company is an LLC either organized in or qualified to transact business in New York and not falling within one of twenty specific categories similar, but not identical, to the twenty-three exemptions from reporting company status under the pre-IFR Reporting Rules.^[69]

There will remain, however, significant issues. For example, the definition of “beneficial owner” (effective as of January 1, 2026) references both the CTA statute and the related regulations, the latter now exempting all U.S. persons from its scope.^[70] Under the possibly amended definition, a “beneficial owner” will be “any entity or individual who, directly or indirectly, through any contract, arrangement, understanding, relationship, or otherwise: (1) exercises substantial control over the entity; or (2) owns or controls not less than twenty-five percent of the ownership interests of the entity.”^[71] And herein lie more problems. First, what is the definition of “substantial control”? It was exhaustively defined in the CTA’s Reporting Rules,^[72] but it is not proposed that the definition there employed be incorporated by reference into the Transparency Act. And what is the definition of “owns or controls”? What it meant under the CTA’s Reporting Rules to “own or control” an interest in a reporting company was carefully detailed,^[73] but no similar definition appears or is proposed to be added to the Transparency Act. Last, although what constitutes an “ownership interest” in a reporting company was detailed in the CTA’s Reporting Rules,^[74] that term is not defined in the Transparency Act.

Further, there is a provision of New York Senate Bill 8432 (which substituted for Assembly Bill 8662) that is simply baffling, namely, a revised definition of “exempt company” that appears to be a faulty cut-and-paste:

(c) “Exempt company” shall mean a limited liability company or foreign limited liability company not otherwise defined as a reporting company that meets one or more of the following conditions:

(1) a minor child, which shall mean an individual under the age of eighteen;

(2) an individual acting as a nominee, intermediary, custodian, or agent on behalf of another individual;

(3) an individual acting solely as an employee of a corporation, limited liability company, or other similar entity and whose control over or economic benefits from such entity is derived solely from the employment status of the person;

(4) an individual whose only interest in a corporation, limited liability company, or other similar entity is through a right of inheritance; or

(5) a creditor of a corporation, limited liability company, or other similar entity, unless the creditor meets the requirements of paragraph one of this subdivision.^[75]

While this is clearly based upon a provision of the Reporting Rules,^[76] in the Reporting Rules it is a series of exemptions from the defined term “beneficial owner”—not “exempt company.”^[77]

There also exists the question of whether there will be sufficient time for New York to both organize its beneficial ownership reporting database (to date, the authors are unaware of the promulgation of even proposed regulations) and publicize the revised law.

As matters stand currently, consequent to its linkage to the CTA’s Reporting Rules as to what is a “reporting company,” the Transparency Act will not apply either to the LLCs organized (“created,” in the parlance of the CTA) in New York or to any other LLC organized in the United States.^[78] Rather, it will reach only LLCs that have been formed outside the U.S. and then have qualified or do qualify to transact business in New York^[79]—assuming that the foreign organization does fall within the scope of a reporting company requiring it to be a “limited liability company” and an “entity.”^[80] In order to return the Transparency Act to its intended scope, its revision will be necessary in order to de-link its definitions from those now employed in the CTA and the post-IFR Reporting Rules.^[81]

Beneficial Ownership Reporting in Limbo

As we bring this article to a close, the CTA still remains on the books, even as the current administration has through questionable regulatory action destroyed the contemplated reporting system;^[82] the Southwest U.S. border GTO is in litigation and has at the circuit court level been found wanting; the residential real estate GTOs are provisionally extended until the delayed effective date of the Residential Real Estate Rules, which are themselves under challenge;^[83] and New York’s LLC Transparency Act is caught between the rock and the hard place of adopted-by-reference defined terms that are now inconsistent.

We are certainly glad to have cleared up all of that.^[84]

Postscript

In Christina M. Houston, Robert R. Keatinge, Thomas E. Rutledge & James J. Wheaton, What Fresh Hell Can This Be? Beneficial Ownership Reporting in Limbo, Bus. L. Today (Dec. 9, 2025), at footnote 259 we discussed the Fidelity National litigation in which the validity of the RRE Rules was challenged. Fid. Nat’l Fin., Inc. v. Bessent, No. 3:25-cv-00554 (M.D. Fla. filed May 20, 2025). We noted that as to its status oral argument as to competing motions for summary judgment has been heard. On December 9 the magistrate judge issued a recommendation (docket item 82) that the plaintiffs’ motion for summary judgment be denied and that the government’s motion for summary judgment be granted, finding that the adoption of the RRE Rules was legitimate pursuant to a statutory grant of authority.

1. Of the famous poet and witticist Dorothy Parker (1893–1967), it is said:

   “If the doorbell rang in her apartment, she would say, ‘What fresh hell can this be?’—and it wasn’t funny; she meant it.” You might as well live: the life and times of Dorothy Parker, John Keats (Simon Schuster, 1970, p. 124). Often quoted as “What fresh hell is this?” as in the title of the 1987 biography by Marion Meade, “Dorothy Parker: What Fresh Hell Is This?”

   See Dorothy Parker, Wikiquote (last visited Nov. 22, 2025). The authors suggest this is a fair summation of all that practitioners have had to face over the last more than two years in staying current on developments in beneficial ownership reporting. ↑

2. See Christina M. Houston, Robert R. Keatinge, Thomas E. Rutledge & James J. Wheaton, What Fresh Hell Can This Be? Beneficial Ownership Reporting in Limbo, Bus. L. Today (Dec. 9, 2025). ↑

3. See Christina M. Houston, Robert R. Keatinge, Thomas E. Rutledge & James J. Wheaton, What Fresh Hell Can This Be? Beneficial Ownership Reporting and the CTA, Bus. L. Today (Dec. 10, 2025). ↑

4. The closest exception to this statement is the District of Columbia, which has since 2019 required disclosure of beneficial owners with ownership of or exceeding 10 percent or who control or have the ability to control the operational direction of the company. See D.C. Code § 29-102.01(a)(6), (7) (addressing initial filings by, respectively, domestic and foreign entities); id. § 29-102.11(a)(6), (7) (annual report filings by, respectively, domestic and foreign entities); see also 1 Larry E. Ribstein, Robert R. Keatinge & Thomas E. Rutledge, Ribstein and Keatinge on Limited Liability Companies § 4A:36 (Dec. 2025). ↑

5. See S.B. 995B, 2023–2024 Leg. (N.Y. 2023) (signed by the governor on Dec. 22, 2023) (Approval Memo 91) (codified as 2023 New York Laws 772 and effective 365 days after adoption (theoretically, Saturday, December 21, 2024)). It was then amended on March 21, 2024, to, among other points, provide an initial effective date of January 1, 2026. See S.B. 8059, 2023–2024 Leg., § 10 (N.Y. 2024); see also Andrew Weiner, Brian Montgomery & Deborah Thoren-Peden, Why NY May Want to Reconsider Its LLC Transparency Law, Law360 (Mar. 13, 2025) (“New York is, as of this date, the only state to have enacted a beneficial ownership disclosure law modeled on the federal Corporate Transparency Act.”).

   While New York is the only state-level beneficial ownership system comparable to the CTA in effect, similar programs have been considered in California (S.B. 738, 2023–24 Sess. (Cal. 2024)); Maryland (S.B. 954, 2024 Gen. Assemb., Reg. Sess. (Md. introduced Feb. 2, 2024)); and Massachusetts (H. 3566, 193d Gen. Ct. (Mass. introduced Mar. 30, 2023)). See also Weiner, Montgomery & Thoren-Peden, supra (“During the salad days of the federal CTA, before the opposition coalesced, several state legislatures jumped into the fray and considered their own CTA-like legislation, notably California, Maryland and Massachusetts. But only New York succeeded in adopting a ‘baby CTA’ statute, named the LLC Transparency Act.”). ↑

6. See N.Y. Ltd. Liab. Co. Law [hereinafter NYLLC Law], § 102(m) (defining “limited liability company” or “domestic limited liability company” to mean “an unincorporated organization of one or more persons having limited liability for the contractual obligations and other liabilities of the business . . . other than a partnership or trust, formed and existing under this chapter and the laws of this state.”). ↑

7. See id. § 1106(b) (effective Jan. 1, 2026) (“‘Reporting company’ shall have the same meaning as defined in 31 U.S.C. § 5336(a)(11), as amended, and any regulations promulgated thereunder, but shall only include limited liability companies formed or authorized to do business in New York state.”). That provision of the CTA (31 U.S.C. § 5336(a)(11)(A)) identifies a reporting company as:

   (A) means a corporation, limited liability company, or other similar entity that is—

   (i) created by the filing of a document with a secretary of state or a similar office under the law of a State or Indian Tribe; or

   (ii) formed under the law of a foreign country and registered to do business in the United States by the filing of a document with a secretary of state or a similar office under the laws of a State or Indian Tribe. ↑

8. See NYLLC Law § 1107 (effective Jan. 1, 2026) provides in part:

   (d) Within thirty days of an initial filing of articles of organization or an application for authority pursuant to this chapter, a reporting company shall file with the department of state a beneficial ownership disclosure that complies with subdivision (a) of this section. Within thirty days of an initial filing of articles of organization or an application for authority pursuant to this chapter, an exempt company shall file with the department of state an attestation of exemption that complies with subdivision (b) of this section.

   (e) Within one year of the effective date of this section, all previously formed or authorized reporting companies shall file with the department of state a beneficial ownership disclosure that complies with subdivision (a) of this section. Within one year of the effective date of this section, all previously formed or authorized exempt companies shall file with the department of state an attestation of exemption that complies with subdivision (b) of this section. ↑

9. See id. § 102(k). This section defines a “foreign limited liability company” as:

   an unincorporated organization formed under the laws of any jurisdiction, including any foreign country, other than the laws of this state (i) that is not authorized to do business in this state under any other law of this state and (ii) of which some or all of the persons who are entitled (A) to receive a distribution of the assets thereof upon the dissolution of the organization or otherwise or (B) to exercise voting rights with respect to an interest in the organization have, or are entitled or authorized to have, under the laws of such other jurisdiction, limited liability for the contractual obligations or other liabilities of the organization. ↑

10. See id. § 1107(d), (e) (effective Jan. 1, 2026). ↑

11. See id. § 1107(c) (effective Jan. 1, 2026) (“All beneficial ownership disclosures, attestations of exemption, and filing fees shall be submitted electronically as prescribed by the department of state. The beneficial ownership disclosure or attestation of exemption shall be signed electronically consistent with the provisions of article three of the state technology law.”). What are to be the filing fees that attach to these filings have not yet been publicly addressed. See also Memorandum from John Whalen, N.Y. Secretary of State’s Office, to “Drawdown Accounts” Dated Nov. 3, 2025, Re: Beneficial Owner Disclosure (copy is in possession of authors). (“All beneficial ownership disclosure statements and attestations of exemption must be filed with the Department electronically. The Department is developing an online filing system, that will be available on 01/01/2026.”). ↑

12. See NYLLC Law § 1108(h) (effective Jan. 1, 2026) (“The secretary of state may promulgate regulations necessary to effectuate the provisions of this article.”). ↑

13. As of December 7, 2025. ↑

14. See NYLLC Law § 1107(d) (effective Jan. 1, 2026) (“Within thirty days of an initial filing of articles of organization or an application for authority pursuant to this chapter, a reporting company shall file with the department of state a beneficial ownership disclosure that complies with subdivision (a) of this section. Within thirty days of an initial filing of articles of organization or an application for authority pursuant to this chapter, an exempt company shall file with the department of state an attestation of exemption that complies with subdivision (b) of this section.”). ↑

15. See id. § 1107(e) (effective Jan. 1, 2026) (“Within one year of the effective date of this section, all previously formed or authorized reporting companies shall file with the department of state a beneficial ownership disclosure that complies with subdivision (a) of this section. Within one year of the effective date of this section, all previously formed or authorized exempt companies shall file with the department of state an attestation of exemption that complies with subdivision (b) of this section.”). ↑

16. See id. § 1107(d) (effective Jan. 1, 2026) (“Within thirty days of an initial filing of articles of organization or an application for authority pursuant to this chapter, a reporting company shall file with the department of state a beneficial ownership disclosure that complies with subdivision (a) of this section. Within thirty days of an initial filing of articles of organization or an application for authority pursuant to this chapter, an exempt company shall file with the department of state an attestation of exemption that complies with subdivision (b) of this section.”); see also Memorandum from John Whalen at the N.Y. Secretary of State’s office, supra note 11:

    Foreign limited liability companies that are authorized to do business in New York State on or after January 1, 2026, will be required to file an initial beneficial owner disclosure statement or attestation of exemption within 30 days of authorization. Those authorized to do business in New York State prior to January 1, 2026, will need to file by December 31, 2026. ↑

17. See NYLLC Law § 1107(e) (effective Jan. 1, 2026) (“Within one year of the effective date of this section, all previously formed or authorized reporting companies shall file with the department of state a beneficial ownership disclosure that complies with subdivision (a) of this section. Within one year of the effective date of this section, all previously formed or authorized exempt companies shall file with the department of state an attestation of exemption that complies with subdivision (b) of this section.”); see also Memorandum from John Whalen at the N.Y. Secretary of State’s office, supra note 11. ↑

18. See NYLLC Law § 1106(b) (effective Jan. 1, 2026). ↑

19. See id. § 1107(b) (effective Jan. 1, 2026) (“[A]ll exempt companies shall electronically file, under penalty of perjury, an attestation of exemption in such form designated by the department of state, which statement shall include the specific exemption claimed and the facts on which such exemption is based. Any company filing an exemption pursuant to this subdivision shall be subject to the annual statement requirement as stated in subdivision (g) of this section in the form prescribed by the department, which statement shall be attested to under penalty of perjury.”); see also Andrew Weiner, Brian Montgomery & Deborah Thoren-Peden, Evolving Federal Rules Pose Further Obstacles to NY LLC Act, Law360 (May 14, 2025) (“An exempt company, to qualify for exemption under the LLC Transparency Act, must file an attestation of exemption, under penalty of perjury, citing the exemption claimed and the facts on which the exemption is based, to be updated annually.”).

    Aside from the inconsistency problem identified below, this requirement is a marked departure from the CTA as enacted through the Reporting Rules. Under that system, no filing was required if a company as of an initial effective date was able to avail itself of an exemption from reporting company status. If a company filed a Beneficial Ownership Information Report (“BOIR”) and then fell within the scope of an exemption, it would file an updated BOIR indicating it was henceforth exempt, but without the requirement to identify under which exemption it fell. See 31 C.F.R. §§ 1010.380(a)(2)(ii), 1010.380(b)(3)(ii). ↑

20. See NYLLC Law § 1107(g) (effective Jan. 1, 2026) (“Once the initial beneficial ownership disclosure has been filed, all reporting companies shall electronically file with the department of state an annual statement confirming or updating: (1) their beneficial ownership disclosure information; (2) the street address of its principal executive office; (3) status as exempt company, if applicable; and (4) such other information as may be designated by the department of state.”). ↑

21. Compare 31 C.F.R. § 1010.380(a)(2)(i). ↑

22. See NYLLC Law § 1106(a) (effective Jan. 1, 2026) (“‘Beneficial owner’ shall have the same meaning as defined in 31 U.S.C. § 5336(a)(3), as amended, and any regulations promulgated thereunder.”). ↑

23. See id. § 1106(d) (effective Jan. 1, 2026) (“‘Applicant’ shall have the same meaning as defined in 31 U.S.C. § 5336(a)(2), as amended, and any regulations promulgated thereunder, but shall only include those relating to limited liability companies.”). The cited provision of the CTA provides:

    APPLICANT.—The term “applicant” means any individual who—(A) files an application to form a corporation, limited liability company, or other similar entity under the laws of a State or Indian Tribe; or (B) registers or files an application to register a corporation, limited liability company, or other similar entity formed under the laws of a foreign country to do business in the United States by filing a document with the secretary of state or similar office under the laws of a State or Indian Tribe.

    The Reporting Rules, pre-IFR, at 31 C.F.R. § 1010.380(e), defined “company applicant” as:

    (1) For a domestic reporting company, the individual who directly files the document that creates the domestic reporting company as described in paragraph (c)(1)(i) of this section;

    (2) For a foreign reporting company, the individual who directly files the document that first registers the foreign reporting company as described in paragraph (c)(1)(ii) of this section; and

    (3) Whether for a domestic or a foreign reporting company, the individual who is primarily responsible for directing or controlling such filing if more than one individual is involved in the filing of the document.

    This provision was amended by the IFR to provide:

    For purposes of this section, the term “company applicant” means:

    (1) [Reserved]

    (2) The individual who directly files the document that first registers the reporting company as described in paragraph (c)(1)(ii) of this section; and

    (3) The individual who is primarily responsible for directing or controlling such filing if more than one individual is involved in the filing of the document. ↑

24. See also 1 Larry E. Ribstein, Robert R. Keatinge & Thomas E. Rutledge, Ribstein and Keatinge on Limited Liability Companies § 4A:18 (Dec. 2025):

    The CTA goes on to require that the initial BOIRs filed by reporting companies include information as to the applicant. This protocol was modified in the Reporting Regulations to the effect that (a) companies pre-existing the effective date of the Reporting Regulations are not required to identify their applicants (renamed in the Reporting Regulations the “company applicant(s)”) and (b) eliminated the requirement that the identifying information provided as to the company applicant be updated. ↑

25. See also Robert R. Keatinge & Thomas E. Rutledge, Impossible Things: Compliance with the Corporate Transparency Act When Beneficial Owners or Company Applicants Are Nonresponsive, Bus. L. Today (Dec. 16, 2024). ↑

26. Permitting the use of a business address is a departure from the CTA, which requires a residential address. See 31 C.F.R. § 1010.380(b)(1)(ii)(C)(2). ↑

27. See NYLLC Law § 1107(a) (effective Jan. 1, 2026). In contrast with the CTA (31 C.F.R. § 1010.380(b)(ii)(E)), the Transparency Act does not require an image of the passport / driver’s license / identification card from which the unique identifying number is taken. In another contrast with the CTA, it provided for a “FinCEN ID” that could be used by a beneficial owner in place of providing to the company his or her personal identifying information, with that FinCEN ID number then included in the reporting company’s BOIR. See 31 C.F.R. § 1010.38(b)(4); see also Ribstein, Keatinge & Rutledge, supra note 4, § 4A:25. The Transparency Act has no equivalent to a FinCEN ID. ↑

28. See NYLLC Law § 1108 (effective Jan. 1, 2026). ↑

29. See id. § 1106(b). There is a certain ambiguity in determining what is a foreign “limited liability company”; if a foreign country does not use that label, is the foreign entity a “limited liability company”? ↑

30. See 31 U.S.C. § 5336(a)(11)(i); 31 C.F.R. § 1010.380(c)(1)(i). ↑

31. See 31 U.S.C. § 5336(a)(11)(ii); 31 C.F.R. § 1010.380(c)(1)(ii). ↑

32. See S.B. 8059, 2023–2024 Leg., § 10 (N.Y. 2024). ↑

33. See 31 C.F.R. § 1010.380(a)(1)(A). ↑

34. See NYLLC Law § 1107(d) (effective Jan. 1, 2026). ↑

35. See 31 C.F.R. § 1010.380(a)(1) (extended in 2024 to ninety calendar days); see also Beneficial Ownership Information Reporting Deadline Extension for Reporting Companies Created or Registered in 2024, 88 Fed. Reg. 66730 (Sept. 28, 2023). ↑

36. See NYLLC Law § 1107(e) (effective Jan. 1, 2026) (“Within one year of the effective date of this section, all previously formed or authorized reporting companies . . . .”). ↑

37. See 31 C.F.R. § 1010.380(a)(1)(iii). ↑

38. See NYLLC Law § 1107(g) (effective Jan. 1, 2026) (“Once the initial beneficial ownership disclosure has been filed, all reporting companies shall electronically file with the department of state an annual statement confirming or updating: (1) their beneficial ownership disclosure information; (2) the street address of its principal executive office; (3) status as exempt company, if applicable; and (4) such other information as may be designated by the department of state.”). ↑

39. See 31 C.F.R. § 1010.380(a)(2). ↑

40. See NYLLC Law § 1107(a) (effective Jan. 1, 2026). ↑

41. See 31 C.F.R. §§ 1010.380(b)(1)(ii) (“and every individual who is a company applicant”), 1010.380(b)(2)(iv) (“Notwithstanding paragraph (b)(1)(ii) of this section, if a reporting company was created or registered before January 1, 2024, the reporting company shall report that fact, but is not required to report information with respect to any company applicant”). ↑

42. See 31 C.F.R. § 1010.380(b)(1)(ii)(E). ↑

43. See 31 C.F.R. § 1010.380(b)(4). ↑

44. See NYLLC Law § 1107(d) (effective Jan. 1, 2026), which provides in part:

    (2) by court order; (3) to officers or employees of another federal, state or local government agency where disclosure is necessary for the agency to perform its official duties as required by statute or necessary to operate a program specifically authorized by law; or (4) for a valid law enforcement purpose including as relevant to any law enforcement investigation by the office of the attorney general. ↑

45. See 31 U.S.C. § 5336(c)(2)(B). ↑

46. See 31 U.S.C. § 5336(c)(2)(C). ↑

47. See NYLLC Law § 1107(f) (effective Jan. 1, 2026). ↑

48. See 31 U.S.C. § 5336(c)(2)(A). ↑

49. See NYLLC Law § 1108(a)(2) (effective Jan. 1, 2026). ↑

50. See NYLLC Law § 1108(a)(3) (effective Jan. 1, 2026). ↑

51. See NYLLC Law § 1108(b)(1) (effective Jan. 1, 2026). ↑

52. See NYLLC Law § 1108(b)(2) (effective Jan. 1, 2026). ↑

53. See NYLLC Law §§ 1108(e)(1), 1108(e)(4) (effective Jan. 1, 2026). ↑

54. See 31 U.S.C. § 5336(h)(3)(A). ↑

55. See 31 U.S.C. § 5336(h)(3)(B). ↑

56. See NYLLC Law § 1107(b) (effective Jan. 1, 2026) (“All exempt companies shall electronically file, under penalty of perjury, an attestation of exemption in such form designated by the department of state, which statement shall include the specific exemption claimed and the facts on which such exemption is based.”). ↑

57. See 31 C.F.R. § 1010.380(a)(2)(ii):

    If a reporting company meets the criteria for any exemption under paragraph (c)(2) of this section subsequent to the filing of an initial report, this change will be deemed a change with respect to information previously submitted to FinCEN, and the entity shall file an updated report.

    See also Fin. Crimes Enf’t Network, Frequently Asked Questions (“FAQs”), FAQ J.8 (Sept. 18, 2023). ↑

58. See Revised NYC Property Transfer Tax Return Requires New Disclosures for Multiple Member LLCs, Prac. L. Real Est. (July 23, 2015); see also Lauren Elkies Schram, 5 Reasons Why the New LLC Disclosure Rules Stink, Com. Observer (July 29, 2015). New York is also considering in 2025 legislation that if enacted would require the filing of additional beneficial ownership information for LLCs that file a Rent Registration Statement under the Emergency Tenant Protection Act of 1974. S.B. 119, 2025–2026 Leg. (N.Y. 2025). ↑

59. See NYLLC Law § 1106(a) (effective Jan. 1, 2026). ↑

60. See 31 C.F.R. § 1010.380(d)(4)(ii). ↑

61. See NYLLC Law § 1106(b) (effective Jan. 1, 2026). ↑

62. See 31 C.F.R. § 1010.380(c)(2)(xxiv). ↑

63. See NYLLC Law § 1106(c) (effective Jan. 1, 2026). ↑

64. See 31 C.F.R. § 1010.380(d)(4)(i). ↑

65. See NYLLC Law § 1106(d) (effective Jan. 1, 2026). ↑

66. See 31 C.F.R. § 1010.380(e). ↑

67. See S.B. 8432, 2025–2026 Leg. (N.Y. 2025) (substituting for A.B 8662A, 2025–2026 Leg. (N.Y. 2025)). To the authors’ knowledge, these bills were passed but not sent to the governor when the New York legislature adjourned. ↑

68. See NYLLC Law § 1106(b) (effective Jan. 1, 2026). ↑

69. See S.B. 8432, § 1; A.B. 8662A, § 1; see also 31 U.S.C. § 5336(a)(11)(B); 31 C.F.R. § 1010.380(c)(2). ↑

70. See Houston, Keatinge, Rutledge & Wheaton, supra note 3. ↑

71. See S.B. 8432, § 1(a); A.B. 8662A, § 1(a). ↑

72. See 31 C.F.R. § 1010.380(d)(1). ↑

73. See id. § 1010.380(d)(2)(ii)–(iii), (d)(3). ↑

74. See id. § 1010.380(d)(2)(i). ↑

75. See S.B. 8432, § 1(c); A.B. 8662, § 1(c). ↑

76. See 31 C.F.R. § 1010.380(d)(3). ↑

77. This is not to suggest that this let’s just say inexplicable provision of Senate Bill 8432 is its only failing. Section (1)(b)(2), which intends to define those LLCs exempt from the BOR filing obligation (although they are required to file a statement that they are exempt and that specifies the exemption(s) upon which they are relying), includes at (xvi) an exemption for any [LLC] that “(A) operates exclusively to provide financial assistance to, or hold governance rights over, any entity described in subparagraph (xiv). . . .” Subparagraph (xiv) addressed pooled investment vehicles. No doubt the intended cross-reference is to (xv), which addresses nonprofit organizations under I.R.C. § 501(c). See also 31 U.S.C. §§ 5336(a)(ii)(B)(xx), 5336(a)(ii)(B)(xix); 31 C.F.R. §§ 1010-380(c)(2)(xx), 1010-380(c)(2)(xix). Ergo, the CTA’s exemption from reporting company classification for an “entity assisting a tax-exempt entity,” except as to the perhaps null set of I.R.C. § 501 tax-exempt pooled investment vehicles, is not available under the Transparency Act. Thanks to Alan Stachura for pointing out this obscure error. ↑

78. See also Weiner, Montgomery & Thoren-Peden, supra note 19:

    As a result, the term “reporting company” under the regulations to the CTA, including the IFR, now refers only to foreign reporting companies. Any entity formed in the U.S., the District of Columbia or any U.S. territory is by definition not a reporting company and therefore is expressly exempt from reporting.

    Unless and until the IFR is significantly changed by the promised final rule, the arguable consequence is the elimination of the requirement under the LLC Transparency Act to report any information for any LLC created in New York or elsewhere in the U.S. and qualified to do business in New York. ↑

79. See Memorandum from John Whalen at the N.Y. Secretary of State’s office, supra note 11 (“Effective January 1, 2026, limited liability companies that are formed under the laws of a foreign country and which are authorized to do business in New York will be subject to new beneficial ownership information disclosure requirements.”). ↑

80. See also Ribstein, Keatinge & Rutledge, supra note 4, § 4A:10. Note that the Transparency Act references the CTA for what is a “foreign LLC” and does not use the definition of that term otherwise employed in the New York LLC Act. See NYLLC Law § 102(k):

    “Foreign limited liability company” means an unincorporated organization formed under the laws of any jurisdiction, including any foreign country, other than the laws of this state (i) that is not authorized to do business in this state under any other law of this state and (ii) of which some or all of the persons who are entitled (A) to receive a distribution of the assets thereof upon the dissolution of the organization or otherwise or (B) to exercise voting rights with respect to an interest in the organization have, or are entitled or authorized to have, under the laws of such other jurisdiction, limited liability for the contractual obligations or other liabilities of the organization. ↑

81. See Andrew J. Weiner, Brian H. Montgomery & Deborah S. Thoren-Peden, The Ironic Impact of FinCEN’s New CTA Regulations on New York’s LLC Transparency Act, Pillsbury (May 5, 2025). ↑

82. See Christina M. Houston, Robert R. Keatinge, Thomas E. Rutledge & James J. Wheaton, What Fresh Hell Can This Be? Beneficial Ownership Reporting and the CTA, Bus. L. Today (Dec. 10, 2025). ↑

83. See Christina M. Houston, Robert R. Keatinge, Thomas E. Rutledge & James J. Wheaton, What Fresh Hell Can This Be? Beneficial Ownership Reporting in Limbo, Bus. L. Today (Dec. 9, 2025). ↑

84. The authors would like to thank Pia Angelikis, Dr. J. William Callison, Professor Michael Healy, Kevin Shepherd, Alan Stachura, and Andrew Weiner for helpful comments on aspects of this manuscript. The authors retain the responsibility for any and all errors herein. ↑