Happy Wednesday! In this week's Big I Buzz, we shed some light on the Corporate Transparency Act exemption for insurance agents.

Big ‘I’ Secures Corporate Transparency Act Exemption for Insurance Agents

The CTA, which passed as part of the National Defense Authorization Act in 2021, contains a provision that creates a burdensome new federal reporting requirement for most small businesses. This new requirement was originally meant to cover nearly all small businesses, including insurance agents. However, the Big “I" was successful in securing an exemption for independent agents and brokers by showing that insurance producers already provide this beneficial ownership information to state regulators and that the additional burden of providing it to the federal government would be duplicative and unnecessary.

An entity that qualifies under any of the 23 exemptions will not need to file a BOI report, unless the company later becomes nonexempt. If an entity is also engaged in other non-exempt business-related activities, they should evaluate whether this applies to them or not. The 23 categories of exemptions from the BOI reporting rule are specified in the CTA and in the final rule implementing the reporting requirement. They are also described in FinCEN’s Small Entity Compliance Guide.

Read more here.

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