A NOTE FROM MATT
I’d like to take a moment to thank you for placing your trust in Parasec. We know that our clients have faced many challenges over the past few years, and we’re glad when we can be of support in even a small way. We hope that our team continues to help minimize costs, ease workloads and reduce some stress. They truly take pride in being able to share their specialized expertise and knowledge with clients. As employee owners, each member of our team is committed to building long-lasting relationships.
Maintaining a high-quality customer experience from start to finish remains a top priority for us. We are constantly investigating new products and ways to improve upon our business solutions without compromising the high standards we hold for both quality and customer care. Our team also closely monitors industry news and updates, including impending compliance obligations like those under the Corporate Transparency Act (read our blog posts on the topic here). If you’re reading this note, you probably already receive our quarterly newsletter, but we also post regularly on our LinkedIn page.
Additionally, our team of employee owners are readily available and easily accessible during normal business hours. Please don’t hesitate to reach out if you have any questions, comments or suggestions—we value your feedback greatly.
California: Formation and Qualification Fees Return
Last year, with the enactment of Senate Bill 154, California waived the initial formation and qualification filing fees for corporations, limited liability companies, and limited partnerships. The grace period for that fee waiver is scheduled to expire on July 1, 2023, at which time the original formation/qualification fees will be reinstated. If you need assistance with an entity formation, please reach out to our team at firstname.lastname@example.org.
Delaware: Filing Fee Increases
The Delaware House and Senate have both passed Senate Bill 110, which would increase the courthouse municipality fee assessed on limited liability company (LLC) and corporate filings from $20 to $40. The bill is currently awaiting action from Governor John Carney. If Carney signs, the effective date of the fee increases will be August 1, 2023. To read the bill in its entirety, go here.
New York: Disclosure of LLC Beneficial Owner Information (BOI)
Assembly Bill 3484A, also referred to as the “LLC Transparency Act,” aims to shed light on the beneficial owners of limited liability companies (LLC) in New York. If passed, the bill would require that LLCs disclose a list of beneficial owners along with any formation/registration documents submitted to the New York Department of State. The bill would also require that the Secretary of State maintain a publicly searchable business entity database on its website. The database would be required to include—among other things—the name of the entity, the current business street address and county, and the full name(s) of each beneficial owner. The Secretary of State would also be required to establish rules and regulations to allow beneficial owners to apply for confidentiality waivers. The bill has passed the New York State Assembly and will now return to the Senate. If passed there, it will then head to Governor Kathy Hochul for a signature. If the bill is signed, it is set to take effect one year after the governor signs it. This bill’s beneficial ownership reporting requirements are modeled on the impending Corporate Transparency Act; however, this bill would establish a public BOI database vs one only accessible by certain government authorities and financial institutions. To read the bill in its entirety, go here.
Oregon: Annual Report Solicitation
Many Oregon businesses have recently reported receiving questionable solicitations with headlines like “2023 – Annual Report Instruction Form” or “State Annual Report Renewal Notice.” Like so many similar scams, these solicitations employ misleading language and visual elements which can easily be mistaken for official correspondence. Despite their appearance, these solicitations were not sent by the Oregon Secretary of State. If you were misled into paying the additional fee, you can file a complaint with the Department of Justice here. For more information, visit the “Don’t Be Misled” page here.
Nationwide: UCC Form Changes
The International Association of Commercial Administrators (IACA), which drafts the Uniform Commercial Code (UCC) forms, has implemented changes to the UCC filing forms with a revised date of July 1, 2023. While the UCC has been adopted by all 50 states as well as the District of Columbia, each state determines which forms it will accept. In anticipation of the updated forms, our UCC specialists have been communicating with various offices to seek clarification on which forms will be accepted moving forward. At the time of publication, the following states confirmed they will not start accepting the new form right away. Those states are: Nevada, New York, and Vermont. Please note, this list is subject to change at any given time. To discuss your specific situation or learn more about our UCC services, please reach out to our UCC specialists at email@example.com. Our team is here to help!
Federal: Corporate Transparency Act
We at Parasec are closely monitoring any new developments with regard to the Corporate Transparency Act (CTA) and the impending compliance requirements that will take effect on January 1, 2024. The Financial Crimes Enforcement Network (FinCEN)—which has been authorized to collect beneficial ownership information (BOI) for certain entities under the CTA—recently issued its first set of guidance materials to aid in the understanding of the upcoming requirements. FinCEN is still in the process of developing the infrastructure and IT system needed to govern, collect, and store the information securely. According to FinCEN, those companies with reporting obligations will complete the process electronically through a secure filing system via its website.
While we wait for that online system to be developed and the legal requirements to go into effect, we suggest that companies begin assessing their reporting obligations. A good first step would be identifying if an entity is exempt or if it will need to comply with reporting requirements. There are some 23+ types of entities that will be exempt from the impending reporting requirements. While the CTA will have minimal impact on these exempt entities, it is likely that they will still have to file an initial report claiming the exemption status.
If your company will be required to report BOI information, it might be a good time to start preparing by identifying any “beneficial owners” and compiling the required information. Likewise, companies may want to develop internal procedures for updating BOI information as needed. Existing reporting companies created before January 1, 2024, will have a full year from the bill’s effective date to meet the new compliance requirement—as their reports are due by January 1, 2025. Any reporting companies created on or after January 1, 2024, must file an initial report within 30 calendar days of actual or public notice of their company’s registration or formation.
International: Canada Accedes Apostille Convention
On May 16, 2023, Canada officially announced that it formerly joined the Convention Abolishing the Requirements of Legalization for Foreign Public Documents (commonly referred to as the Apostille Convention or the Hague Convention). The Apostille Convention will officially go into effect in Canada on January 11, 2024. A statement issued by Global Affairs Canada, stated: “Over 200,000 Canadian public documents are authenticated every year, and this accession will give Canadians a cost-effective, streamlined method for getting their Canadian public documents accepted abroad.” More details are expected to be released before the convention comes into effect. Until that time, Canadian documents will continue to be authenticated according to current procedures and legalization requirements. If you need to have a document apostilled or legalized for use in a foreign country, we can help. Let our team of experts simplify your next international transaction. Reach our team at firstname.lastname@example.org.
International: China Accedes Apostille Convention
On March 8, 2023, China officially submitted documentation to accede to the Convention Abolishing the Requirements of Legalization for Foreign Public Documents. The Convention is expected to enter into force between China and the contracting states on November 7, 2023. This change will greatly simplify the authentication of public documents for use in China. As always, our apostille and legalization services team is available via email at email@example.com should you have any questions.
Happy Retirement, Michele Calkins!
On behalf of Parasec, we would like to thank Michele Calkins for her twenty-five years, four months and 20 days of service! She has been instrumental in the success of our Nevada office, and we are grateful for all of her contributions. While we are extremely happy for her, we (as well as her long-standing clients) are sad to see her go. We will certainly miss Michele and all that she embodies—honesty, dedication, strong work ethic, customer service, and loyalty. Please join us in congratulating her!
And now, a few words from just some of the many clients who had the pleasure of working with Michele…
“Filing in Nevada is a nightmare for a person who does not understand all its requirements. To the rescue was Michele! She was patient, attentive, competently answered my questions, sympathetic with my frustrations on my attempts to ‘DIY,’ and with a bit of humor made me laugh. She has represented Parasec well. Anyway, please pass along to her my wishes for good health, adventures, and happiness in her retirement and our appreciation for her assistance over the years.” ~ Patty S.
“Michele Calkins of the Nevada office is knowledgeable, efficient, and pleasant under last-minute matters. I appreciate the fast and professional assistance that Ms. Calkins provided in a short timeframe.” ~ Stacy H.
New Texas Tax Services
Parasec is excited to offer our clients doing business in Texas new business solutions in regard to annual franchise taxes within the state. Texas requires that all corporations, LLCs, LPs, and LLPs—as well as various other entity types—formed in or doing business in the state file an annual franchise tax report each year. The deadline to file by is May 15 (if the due date falls on a weekend or holiday, the deadline rolls to the next business day). The tax rate is determined by an entity’s gross receipts or margin, and can be calculated in a number of different ways. Even if an entity does not owe taxes, it is still required to file said tax return. Furthermore, Texas will assess a penalty fees for all reports filed late.
With our new Texas tax services, we can assist with preparation and filing of your annual franchise tax report on a one-off basis or annually with our Annual Compliance Tax Service (ACTS). Once you enlist our help, our team will check the entity’s good standing status, confirm prior filings and payment history, review any issues from prior years and work to resolve them, and finally prepare and file your annual franchise tax report. Sit back and let us handle this compliance requirement for you—so you can focus on the day-to-day activities of your business. To learn more about these new services, reach out to us today at firstname.lastname@example.org.
“Your group has always been able to explain confusing government stuff and is very helpful. Keep up the good work.”
~ Ron H., President/CEO