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The Corporate Transparency Act and Beneficial Ownership Information Reports: Do Tax-Exempt Organizations Need to File?

The Corporate Transparency Act and Beneficial Ownership Information Reports - Do Tax-Exempt Organizations header image

The beneficial ownership information (BOI) reporting rules of the Corporate Transparency Act (CTA) became effective on January 1, 2024.  Under the CTA (as outlined in our earlier blog), a reporting company must file a BOI report with the U.S. Financial Crimes Enforcement Network (FinCEN).  

There are 23 enumerated exemptions from the CTA’s BOI reporting requirements. If an entity meets one of the exemptions, that entity is not considered a reporting company and therefore is not required to file BOI report.

Need help determining if you comply with the Corporate Transparency Act? Click here to contact CBM.

Among the exemptions are the following relating to tax-exempt organizations:

  • An organization that is described in Sec. 501(c) of the Internal Revenue Code of 1986 (determined without regard to Sec. 508(a) of the Code) and exempt from tax under Sec. 501(a) of the Code.
  • Subsidiaries wholly owned, directly or indirectly, by one or more tax-exempt organizations.

Do tax-exempt organizations need to file BOI reports?

  • No, since 501(c) organizations are included as one of the enumerated exemptions.

Do wholly owned subsidiaries of tax-exempt organizations need to file BOI reports?

  • No, since wholly owned subsidiaries of one or more 501(c) organizations are included as one of the enumerated exemptions.

What organizations are not covered in the above exemptions?

  • Organizations that lose their tax-exempt status. These organizations would need to report BOI to FinCEN unless their tax-exempt status is reinstated within 180 days; and
  • New nonprofit organizations that have not yet received tax-exempt status from the IRS. These organizations would need to report BOI to FinCEN, until the organization qualifies for one of the exemptions.

Please contact Not-for-Profit Senior Tax Manager Joseph Barreca via our online contact form for more information.

Click here and fill out the form if you need help determining if you comply with the Corporate Transparency Act.

Councilor, Buchanan & Mitchell (CBM) is a professional services firm delivering tax, accounting and business advisory expertise throughout the Mid-Atlantic region from offices in Bethesda, MD and Washington, DC.

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