Effective as of Jan. 1, 2024, many businesses and corporate entities, both foreign and domestic, must file informational reports on their beneficial owners with the Financial Crimes Enforcement Network under the Corporate Transparency Act. Robinson Bradshaw published an article summarizing the CTA and highlighting best practices for achieving compliance, located here. The CTA requirements are complex and allow for numerous exemptions, and the availability of each exemption depends on the specific facts and circumstances.
The Tax Court, in a victory for the IRS, recently issued an opinion holding the limited partner exception to the Self-Employed Contributions Act Tax must be construed narrowly. The court held a limited partner under state law is not automatically a limited partner for purposes of the SECA exclusion.
SECA Background
SECA imposes a tax on the self-employment earnings of individuals, which mirrors the rates applicable to wages of employees under FICA—a 12.4% rate applicable to a capped portion of earnings, plus a 2.9% rate on all earnings (with an additional 0.9% charge above certain ...
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