The New York LLC Transparency Act (NY LLCTA) will take effect on January 1, 2026, requiring non-US limited liability companies (LLCs) registered do business in New York (Reporting Companies) to disclose beneficial ownership information or an attestation of exemption directly to the New York Department of State. This state-level law closely models the earlier version of the federal Corporate Transparency Act (CTA) but imposes separate reporting obligations for New York entities.
Key Requirements
- Most Reporting Companies must file beneficial ownership disclosures within 30 days of formation or registration.
- Existing Reporting Companies already registered with the New York Department of State before January 1, 2026 have until January 1, 2027 to comply.
- Exempt entities must provide an attestation of exemption, and all Reporting Companies—whether exempt or not—must file annual reports to confirm or amend records.
- Unlike the federal CTA, disclosures must be direct; there is no FinCEN identifier equivalent for privacy.
Major Differences from the Federal CTA
- The NY LLCTA mandates annual reports rather than the federal CTA’s update-only-as-needed approach.
- Unlike the federal CTA, the NY LLCTA does not exempt “company applicants” of Reporting Companies existing before the effective date from filing. A “company applicant” is the individual responsible for filing or directing the filing of the Reporting Company’s organization or authorization documents in New York.
BOI (Beneficial Ownership Information) Reports
- Who: Each individual who (i) directly or indirectly exercises substantial control (managers); (ii) owns or controls 25% or more of the ownership interests of a Reporting Company; or (iii) is responsible for filing or directing the filing of the of the Reporting Company’s organization or authorization documents in New York.
- What: (1) full legal name; (2) date of birth; (3) current home or business street address; and (4) a unique identifying number from an acceptable identification document (ex: US driver’s license or US or foreign passport).
- When: Beneficial ownership reports must occur:
- Reporting Companies formed or already registered with the New York Department of State prior to January 1, 2026: prior to January 1, 2027.
- Reporting Companies formed or registered with the New York Department of State after January 1, 2026: within 30 days of formation or registration.
Penalties for Non-Compliance
- Delinquent Reporting Companies may be fined up to $500 per day for ongoing reporting failures.
- The New York Attorney General is empowered to suspend, cancel, or dissolve Reporting Companies that do not comply.
- Attestations of exemption must be signed under penalty of perjury.
Practical Considerations
- Reporting Companies should prepare to gather historical and current applicant/owner information and ensure data security and privacy policies are sufficient for sensitive filings.
- The State of New York has not yet issued final implementation guidance or released its filing portal.
If you have clients who are a manager or beneficial owner of a Reporting Company, now is the time to evaluate exemptions, collect necessary information, and monitor further state guidance as implementing regulations are expected soon.
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IMPORTANT DISCLOSURES
The views expressed in this document, and the description of data supporting these views, are those of SCS Financial Services (together with its affiliates, “SCS”). The materials contained herein do not constitute an offer to sell or a solicitation of an offer to buy any security. Any such offering or solicitation can be made only by means of delivery of a definitive Confidential Private Placement Memorandum (“Offering Memorandum”) which sets forth in detail the terms and conditions of the offering and the applicable risk factors and should be reviewed in its entirety prior to investing. Securities may not be offered, sold or delivered to any prospective investor who does not satisfy certain minimum financial and sophistication criteria, or in any jurisdiction in which such offer is not authorized. SCS does not provide tax, accounting or legal advice and prospective investors should consult their professional advisers as to the tax or legal consequences of any potential investment.
The information in this document is as of the date indicated and is subject to change without notice. In preparing this document, SCS has relied upon certain information provided by third parties without independent verification of the accuracy or completeness of such information and SCS accepts no liability for any direct or consequential losses arising from its use.
Forward Looking Statements
Certain statements contained in this document may be forward-looking statements. By their nature, forward-looking statements involve a number of risks, uncertainties and assumptions that could cause actual results or events to differ materially from those expressed or implied by the forward-looking statements. Forward-looking statements that reference past trends or activities should not be taken as a representation that such trends or activities will necessarily continue in the future. Any economic or market forecast presented herein reflects the judgment of SCS as of the date of this material and is subject to change.
Risks
All investments risk loss of capital and there is no guarantee that an investment will achieve its investment objective. Private Fund investments in particular involve significant risks and are intended for experienced and sophisticated investors. Some of the risks associated with an investment in Private Funds include: (i) use of leverage or other speculative investment practices, (ii) illiquidity of investments including restrictions on transfers, (iii) potential multiple layers of fees and expenses, and (iv) lack of comprehensive regulatory regime. For a complete description of the risks associated with such investments please review the “Risk Factors” and “Conflicts of Interest” sections in the relevant Offering Memorandum.
Performance and Fees
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