New York LLC Transparency Act: Reporting Limited To Non-U.S. LLCs

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Highlights

The New York LLC Transparency Act (NY LLCTA) became effective on January 1, 2026. All non-U.S. limited liability companies (LLCs) that have registered to do business in New York must file a beneficial ownership report or an attestation of exemption.
The NY LLCTA has been prominent in the news in recent weeks, particularly because of the uncertainty as to whether New York Gov. Kathy Hochul would approve a legislative amendment to decouple the NY LLCTA from the Corporate Transparency Act (CTA), as amended by the U.S. Department of the Treasury in March 2025, which limits CTA reporting requirements to non-U.S. companies registered to do business in the U.S.
On December 19, 2025, Gov. Hochul vetoed the amendment. The governor's rationale for the veto was to avoid imposing compliance burdens on New York businesses that are more extensive than the corresponding federal requirements.
Since December 2025, the New York Department of State (NYDOS) has published an ever-increasing amount of guidance, including a series of FAQs, forms and instructions. More guidance is anticipated.

The New York LLC Transparency Act (NY LLCTA) has had a controversial history since its inception. The NY LLCTA was modeled on the federal Corporate Transparency Act (CTA) and incorporated key terms, such as "reporting company," "exempt company" and "beneficial owner," along with the CTA working concepts for the "substantial control" and "ownership interest" tests. However, its scope was limited to limited liability companies (LLCs).

The original version signed into law by Gov. Kathy Hochul on December 22, 2023, would have made all beneficial ownership information publicly available, contrary to the CTA. That version of the NY LLCTA was amended on March 1, 2024, to remove public access.

As amended in 2024, the NY LLCTA required LLCs formed in or authorized to do business in New York to report their individual beneficial owners to the New York Department of State (NYDOS). The purpose underlying the NY LLCTA was similar to the CTA, but state centric, to stop criminal activity through the use of shell LLCs and increase accountability by giving authorities tools to identify and hold accountable individuals behind LLCs involved in misconduct, including tenant/employee mistreatment.

In March 2025, the U.S. Department of the Treasury's Financial Crimes Enforcement Network (FinCEN) issued an interim final rule that exempted U.S. companies from any requirement to file beneficial ownership information and no longer required non-U.S. entities to report beneficial owners who are U.S. persons. Because of the linkage of the NY LLCTA to the CTA, the interim final rule had an unanticipated, direct and limiting impact on the scope of the NY LLCTA.

To negate that limiting result, which would have been contrary to the underlying purpose of the statute, the New York Legislature passed legislation that would have decoupled the NY LLCTA's definition of "beneficial owner," "reporting company" and "exempt entity" from the CTA. However, on December 19, 2025, Gov. Hochul vetoed that legislation. Her stated reason was to avoid imposing compliance burdens on New York businesses that are more extensive than the corresponding federal requirements.

As a result of the governor's veto, the cross-references of the NY LLCTA now are to the CTA, as revised by FinCEN's interim final rule of March 2025, which still has not been finalized. Although FinCEN had stated that it would finalize the interim final rule prior to the end of 2025, that finalization has been delayed.

The NYDOS on December 30, 2025, and thereafter, responded by posting materials on how to comply with the NY LLCTA, including 25 FAQs on the Beneficial Ownership Disclosure, Beneficial Ownership Disclosure Form and Instructions, Initial Attestation and Exemption from Beneficial Ownership Disclosure Form and Instructions, and, for law enforcement, the Application to Access Beneficial Ownership Information and Instructions. Additional guidance is anticipated. Further, the NYDOS has indicated that a submission portal is forthcoming and, for now, a disclosure statement should be submitted in PDF format.

Important Takeaways from the FAQs

Scope: The NY LLCTA is much restricted as it does not apply to LLCs organized in the U.S. and now only applies to LLCs formed outside the U.S. and authorized to do business in New York state.
Exempt from NY LLCTA Reporting Requirements: LLCs formed in the U.S., either in 1) New York state or 2) in another state, the District of Columbia, a U.S. possession or U.S. territory and authorized to do business in New York state, are exempt from any reporting requirements under the NY LLCTA.
Required Filings: LLCs formed in a foreign country that obtain an authorization to do business in New York state under the NY LLCTA are either 1) a Reporting Company, required to file initial and annual Beneficial Ownership Disclosure statements or 2) an Exempt Company, required to file initial and annual Attestation of Exemption statements. Reporting Companies are required to provide information about their beneficial owners who are not U.S. persons and information about their applicants (described below). Beneficial owners are individuals who have a 25 percent or greater ownership interest in the LLC or who exercise substantial control over the LLC.

Filings and Filing Deadlines

The NY LLCTA requires initial and annual filings electronically through the NYDOS secure filing system, together with a filing fee of $25 for each filing of a Beneficial Ownership Disclosure statement or an Attestation of Exemption statement.

Initial Filing

LLCs authorized to do business in New York on or after January 1, 2026, are required to file an Initial Disclosure Statement or Attestation of Exemption within 30 days of filing an application for a Certificate of Authority with the NYDOS.

LLCs authorized to do business in New York state prior to January 1, 2026, have until December 31, 2026, to file a Disclosure Statement or an Attestation of Exemption.

Annual Filing

Once the initial Disclosure Statement or Attestation of Exemption has been filed, all filing companies are required to file an annual statement confirming or updating, as applicable: 1) their beneficial ownership disclosure information, 2) the street address of their principal executive office and 3) the status as exempt company, if applicable, and such other information as may be designated by NYDOS.

Corrected Filing

If a Reporting Company has reason to believe that a report filed with the NYDOS contains inaccurate information, a corrected report may be filed.

How to Determine Whether a Foreign Entity Is an LLC

NYDOS has not provided any guidance regarding which non-U.S. entities are LLCs. As an initial matter, to come within the statute, it must be determined whether a foreign entity formed outside the U.S. is an LLC or some other type of foreign entity. That may not be an easy undertaking, particularly if foreign law does not label the foreign entity as an LLC. That determination may entail an examination of the internal governance structure of the entity or perhaps may be determined based on whether a non-U.S. entity has registered under New York's Business Corporation Law or the New York LLC statute. Hopefully, additional guidance will be provided by the NYDOS on this question.

The Beneficial Ownership Disclosure FAQs

In this section, we distill the FAQs¹ related to Reporting Company compliance and other matters. The terms, such as beneficial owner and applicant, the concepts, such as the substantial control test, the 25 percent ownership test and the exemptions from filing, all derive from the CTA. NYDOS has summarized these terms, concepts and exemptions in a high-level manner in the FAQs.

Who Is a Beneficial Owner? An individual who directly or indirectly exercises "substantial control" over, or owns or controls 25 percent or more of the ownership interests of an LLC is a "beneficial owner." Though trusts, corporations and other entities are not beneficial owners, the individuals who own or control such entities may be beneficial owners. Importantly, Reporting Companies do not need to report individuals as beneficial owners if 1) they are a U.S. person under the U.S. Internal Revenue Code² or 2) if they are excepted from the definition of a beneficial owner.³
What Is the Substantial Control Test? This test applies if the individual is a managing member or senior officer of the Reporting Company, has authority to appoint or remove officers or members of the Reporting Company, is an important decision-maker of the Reporting Company or has any other form of substantial control over the Reporting Company. Note: This test looks at control, rather than ownership of an equity interest in the LLC.
What Is the 25 Percent Ownership Interest Test? This test applies if an individual owns or controls 25 percent or more of the ownership interests in the Reporting Company. To make that determination, it is necessary 1) to identify the ownership interest, which is broadly defined, 2) the individuals who owns such interests (directly or indirectly) and 3) to calculate whether an individual owns/controls 25 percent or more of such ownership interests.
Who Is an Applicant? The applicant for an authorized foreign LLC is the individual who directly files the document that first registers the foreign LLC with the NYDOS. If more than one individual is involved in filing the document, the other applicant (there can be no more than two applicants) is the individual who is primarily responsible for directing or controlling such filing with the NYDOS. Note, since New York state adopted its own LLC law in 1994, it may not be possible to obtain all of the required information to be reported.
What Identifying Information Must Be Disclosed Regarding Each Non-U.S. Beneficial Owner and the Applicant? The information to be disclosed is 1) full legal name, 2) date of birth, 3) current home or business address, and 4) a unique identifying number from an unexpired passport, an unexpired state driver's license, or 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. Note that unlike the CTA, FinCEN identifier numbers are not permitted, which raises privacy concerns, both for the individual supplying the information and the Reporting Company.
Is Beneficial Ownership Information Confidential? All information relating to beneficial owners who are natural persons collected by the NYDOS will be maintained in a secure, nonpublic database and is confidential, subject to limited exceptions by written request of, or by voluntary written consent of the beneficial owner.
Who Can Access Beneficial Ownership Information? The NYDOS may release information pursuant to a court order, or to officers or employees of a federal, state or local government agency where the disclose is necessary for the agency to perform its official duties as required by law or necessary to operate a program required by law. Information may also be disclosed by NYDOS for valid law enforcement purposes. The information is not accessible under the Freedom of Information Law.
Who Can File a Beneficial Ownership Information Report on Behalf of a Reporting Company, and What Information Will Be Collected on Filers? Any person a Reporting Company authorizes to act on its behalf, such as an employee, owner or third-party service provider, may file a beneficial ownership information report on the Reporting Company's behalf. When submitting the report, the filer should be prepared to provide basic contact information about themselves, including their name and email address. The person filing the report, including a third-party service provider, must certify on behalf of the Reporting Company that the information is true, correct and complete.
Are There Penalties for Failing to File a Beneficial Ownership Disclosure Statement or an Attestation of Exemption Statement? Yes, a Reporting Company that fails to file its Beneficial Ownership Disclosure Statement or Attestation of Exemption Statement for a period exceeding 30 days will be shown as "past due" in the records of the NYDOS and on its public database of business entities. A Reporting Company that has failed to file for a period exceeding two years will be shown as "delinquent." The Office of the Attorney General (AG) may assess a fine of up to $500 for each day the Reporting Company has been past due or delinquent and may bring an action to dissolve or cancel an entity that is delinquent in filing. The NYDOS will provide notice to Reporting Companies that have failed to file a Beneficial Ownership Disclosure Statement or an Attestation of Exemption Statement, as required. If the LLC fails to submit a filing within 30 days of said notice, its status will be changed to "suspended." Suspended entities are prohibited from conducting business in New York until such time as the required Beneficial Ownership Statement or Attestation of Exemption Statement has been filed, and filing fees, payment of a $250 fine to the NYDOS and verification that any fines assessed by the New York State AG have been satisfied. Past due" or "delinquent" status may be removed from the records of the NYDOS by filing the current statement and paying a fine of $250 to the NYDOS and any fine assessed by the Office of the AG. A "suspended" status for a LLC may be removed by filing the required Beneficial Ownership Disclosure Statement or Attestation of Exemption Statement. Any related fine must be paid before submitting the LLC's current statement to the NYDOS.
Are There Penalties for Filing a Report That Contains False or Fraudulent Beneficial Ownership Information? Knowingly providing or attempting to provide false or fraudulent beneficial ownership information may result in civil penalties described above and may result in criminal prosecution (see Limited Liability Company Law Section 1108(c), Penal Law Sections 175.30 & 175.35).

For further information or questions, please contact the authors. Please note that Holland & Knight will be hosting a webinar on the NY LLCTA on January 20, 2026. Please register online to reserve your spot.

Footnotes

1. NYDOS provides the following cautionary note regarding its FAQs: Laws are subject to change. These FAQs are based upon federal and state statutes and regulations that took effect on December 23, 2025. For current information, these FAQs should be checked against relevant federal and state statutes and regulations, which are currently 31 U.S.C. 5336(a), 31 C.F.R. 1010.380, and New York State Limited Liability Company Law sections 1106, 1107 and 1108.

2. The term "U.S. persons" include U.S. citizens (including U.S. citizens of Puerto Rico or other territories) and individuals who are U.S. income tax residents; i.e., satisfy the "substantial presence test" or the "Green Card Test" (are "lawful permanent residents") under the U.S. Internal Revenue Code.

3. The five exceptions are minor children, certain nominees, certain employees, inheritors and creditors. To use any of these exceptions, various conditions must be satisfied, so it is important to know and comply with the requirements of the particular exception.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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