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Golenbock Legal Alert – New York LLC Transparency Act: A New Compliance Era for Businesses


Beginning January 1, 2026, New York will require many limited liability companies to disclose their beneficial ownership information under the newly enacted New York LLC Transparency Act (NYLTA).

The Federal government had imposed similar entity reporting requirements with much broader application. However, in March 2025, the U.S. Treasury’s Financial Crimes Enforcement Network (FinCEN) issued an interim final rule significantly narrowing the scope of entities required to submit a beneficial ownership information (BOI) report under the federal Corporate Transparency Act (CTA), originally enacted in 2020. Entities formed under state law, such as LLCs and corporations, are no longer required to submit a BOI Report to FinCEN. The revised rule now applies only to entities formed under foreign law that register to do business in the U.S. (formerly known as “foreign reporting companies”).

(See: Golenbock Legal Alert: FinCEN Issues Interim Final Rule: U.S. Companies Exempt from BOI Reporting, Foreign Entities Still Required to File)

In general, the NYLTA applies to all LLCs formed under New York law as well as foreign LLCs registered to do business in the state.  If an LLC qualifies for an exemption, no BOI report is required to be filed, although the LLC must still file an attestation of exemption with the NY Department of State. LLCs may qualify for one of 23 exemptions (which mirrors the CTA) – those exemptions can be found here.  In practice, this means that virtually every LLC doing business in New York will need to engage with the new reporting system in some form.

For LLCs formed before January 1, 2026, the deadline to file an initial beneficial ownership report is January 1, 2027. LLCs existing on or after January 1, 2026, must file within 30 days of formation or registration. Once filed, reports must be updated annually to confirm or amend ownership information.

The reporting obligation focuses on identifying “beneficial owners.” A beneficial owner includes any individual who directly or indirectly exercises substantial control over an LLC, or who owns or controls at least 25% of its ownership interests. Importantly, the reports will be housed in a secure state database and will not be accessible to the public. That said, the law carries meaningful penalties for failure to comply – non-compliant LLCs may be placed in delinquent status, suspended, or even dissolved, and the New York Attorney General may impose fines of up to $500 per day for late filings.

For business owners, the passage of the NYLTA represents more than a simple administrative formality. Companies should begin reviewing ownership structures now to determine whether they are subject to the law or can claim an exemption. Even exempt entities must be prepared to make an attestation. Moreover, persons forming new LLCs in the coming years should weigh whether New York remains the most advantageous jurisdiction given these new requirements. Although beneficial ownership information will not be made public, companies should anticipate questions and concerns from stakeholders about what data is collected and how it will be safeguarded. Transparent internal communication and coordination with counsel will be important in managing those issues.

Contacts:

Daniel B. Axman
daxman@golenbock.com

(212) 907-7379
Barry A. Cassell
bcassell@golenbock.com
(212) 907-7337
Steven G. Chill 
schill@golenbock.com

(212) 907-7350
Elizabeth Man-Wai Li
eli@golenbock.com

(212) 907-7357