News

The Corporate Transparency Act (CTA), which goes into effect on January 1, 2024, presents a significant change to the reporting requirements for existing corporations, limited liability companies, and other business organizations. Over the next couple months, we will be providing periodic updates on our preparation for the CTA’s implementation and how you can prepare your company for compliance.

Who must Report?

Reporting entities under the CTA include:Corporations, LLCs, or other entities created by filing a document with any secretary of state or similar office, including foreign entities that are registered in the US. While it is not yet certain as of the date of this note, reporting entities may also include LLPs, LLLPs, certain trusts, and most limited partnerships. 

There are 23 exceptions to reporting. The most relevant exceptions include public companies, large operating companies, and tax-exempt entities. A “large operating company” is one that employs more than 20 full time US-based employees, had $5mm in gross receipts or sales over the previous tax year, and has an operating presence at a physical office in the US.

What are the Requirements?

Generally, most companies will need to report three classes of information regarding the reporting company: 

• Identifying information regarding the company itself. 
• Personal information regarding certain owners of the business—those who own 25% of the company or otherwise control its operations. This information includes name, date of birth, address, and identifying credentials, such as a passport and driver’s license.
• Information regarding professionals who assisted the company with its formation. 

The above information will be maintained by the Department of Treasury in a private database that is not available for public review.

What is the Purpose of the CTA?

The CTA is designed to fight corruption, protect the financial system, and prevent drug traffickers, terrorists, and other criminals launder or hide assets in the US.

What are the Risks of Noncompliance?

Failure to report the required information in a timely manner could result in criminal penalties, including:

• Fine of up to $10,000
• Two years in jail
• Penalties of $500 per day of noncompliance

How Can My Company Comply?

The Business Department of MacElree Harvey began its preparation for the CTA over one year ago and is well versed in the new law and its potential impact on our clients. In furtherance of this initiative:

• We created proprietary software to manage our clients’ information in a secure location to position our clients for compliance with the CTA.
• We developed a process with commercial partners to make reporting a manageable process. 

Compliance with the CTA is critical for your business. We encourage you to contact us at [email protected] for help. We will first help you determine whether your company owes a reporting obligation. If so, we will provide a checklist of information you will need to collect for reporting purposes as well as instructions for how to comply.

MacElree Harvey, Ltd. is proud to announce that 26 attorneys were named 2023 Top Lawyers by Main Line Today magazine.

MacElree attorneys have been included in the Main Line Today Top Lawyers list for the 16th consecutive year in 2023. MacElree attorneys have earned the distinction of Top Lawyer since the inception of the award in 2007.

Each spring, lawyers from the Main Line and western Pennsylvania suburbs nominate their colleagues in 25 categories, then those nominations are vetted through Main Line Today’s editorial process to compile the area’s top lawyers.

The following attorneys were named 2023 Top Lawyers in their respective areas of practice:

• Joseph Bellinghieri – Tax Law, Estate, Probate and Tax
• Jeffrey Burke – Employment Law
• Robert Burke – Civil Litigation
• Matthew Cooper – Business
• Harry DiDonato – Business
• Caroline Donato – Criminal Law
• Lindsay Dunn – Municipal Law
• Brian Forgue – Civil Litigation
• Patrick Gallo – Civil Litigation
• Mary Kay Gaver – Business
• Charles Gerbron, Jr. – Municipal Law
• Leo Gibbons – Banking + Finance
• Carolina Heinle – Estate Planning and Administration
• Peter Kratsa – Criminal Law
• Mary Lawrence – Criminal Law
• Michael Louis – Banking and Finance
• John McKenna – Alternate Dispute Resolution
• Matthew McKeon – Real Estate
• Brian Nagle – Real Estate
• Lance Nelson – Divorce + Family Law
• Timothy Rayne – Personal Injury
• Michael Rovito – Divorce + Family Law
• Duke Schneider – Estate, Probate and Tax
• Andrew Silverman – Business
• Ashley Stitzer – Divorce + Family Law
• Louis Teti – Estate, Probate and Tax

With roots that reach back to 1880, MacElree Harvey uses the traditional values of professionalism and excellence as the foundation for the firm’s identity. Our 40+ attorneys are encouraged to build on these traditional values through Initiative – creative problem-solving, proactive planning, and strategic positioning.

MacElree Harvey attorneys serve both Pennsylvania and Delaware and have long had a reputation for Initiative® – in listening, in counsel, in court, and in protecting the interests of every client.

Whether your legal concerns encompass personal matters, your business, litigation, or even emerging areas of the law, such as environmental, intellectual property or elder law, MacElree Harvey is a firm where you will always find Initiative in Practice®. For every client. In every matter. Every day. Visit macelree.com to learn more.

CONTACT INFO:

Website: macelree.com/contact-us

(610) 436-0100

[email protected]

Main Office:

17 West Miner Street

West Chester, PA 19382

We are pleased to announce that MacElree Harvey was named as a Top Workplace by the Philadelphia Inquirer for 2023.

2023 marks 10 years of The Philadelphia Inquirer’s Top Workplaces list.

Every year, employees nominate and complete a questionnaire to represent their opinions regarding their place of work within the Delaware Valley. The employee engagement survey of 24 questions gathers responses regarding issues relating to workplace culture:

• Alignment – where the company is headed, its values, cooperation
• Connection – employees feel appreciated, their work is meaningful
• Effectiveness – doing things efficiently and well, sharing different viewpoints, encouraging new ideas
• My Manager – cares about concerns, helps employees develop
• Engagement – motivation, retention, and recruiting
• Leadership – confidence in company leaders
• The Basics – pay, benefits, flexibility, training, expectations

“Top Workplaces put the employee at the center of things, and focus on creating the right environment to unleash potential and inspire performance,” said Doug Claffey, CEO of Energage, the research partner for Top Workplaces.

Interestingly, Inquirer.com notes that employees consistently rate issues of “Connection” and “Alignment” most important to them, while statements related to pay and benefits rate less important.

View the 2023 ranks: sponsored.inquirer.com/philadelphia-inquirer-top-workplaces-2023

As an advocate for its employees, MacElree Harvey recognizes the importance of gender balance in a team and the significant benefits it brings to the organization. The firm encourages female employees to pursue professional and leadership opportunities, providing them with training and resources to support their professional growth.

For instance, the firm’s Educational Assistance Program has been utilized by female staff and attorneys to further advance their careers. MacElree Harvey also offers work schedule flexibility, including the opportunity to work from home, to support work-life balance among its attorneys. Its Paid Medical Leave of Absence Plan provides paid time off for maternity leave, illness, or injuries. Finally, MacElree Harvey partners with the Chester County Bar Association to promote their Diversity Program, designed for first year law students who identify with groups historically discriminated against on the basis of gender, disability, race, ethnicity, or gender identity.

“MacElree Harvey has a history of advancement and promotion of women within the firm. Most notably, our current CEO, Michelle Foster, has been promoted numerous times over her 20-year career with MacElree Harvey… Several of the current women Partners began their careers with MacElree Harvey as Associate Attorneys and were promoted to Partner,” says Firm Administrator Nicole Castafero. “The Firm promotes women from within, allowing for the advancement of their careers.”  

Working closely with her team, Michelle has established a knowledgeable, cohesive and client-focused workforce, while promoting a Firm culture that motivates and encourages employees to deliver top quality service, and often exceed expectations. To ensure that MacElree Harvey continues to implement its strategic plan, which calls for directed growth, and to continue to provide excellent service to its clients, Michelle understands that her most important job is to maintain the values and legacy embodied in the Firm’s 143 year history.

By: Matthew C. Cooper

Pennsylvania will soon be joining the ranks of the majority of states in the nation requiring business entities organized under its laws to file annual reports to confirm their continued existence. Pennsylvania Act 122 took effect on January 2, 2023 (“Act 122”), repealing Pennsylvania’s unique (and often overlooked) decennial report requirement, and replacing it with a reporting system requirement that aligns with the leading approach taken throughout the United States – filing an annual report.

Previously, business entities/associations were only required to file a report with the Pennsylvania Bureau of Corporations and Charitable Organizations (“Corporation Bureau”) on a rolling ten-year basis (2001, 2011, 2021, etc.) unless the entity/association had made certain filings with the Corporation Bureau within the previous ten-year cycle. Now, new Section 146 will require an annual reporting requirement for Pennsylvania business entities/associations. This aligns with the approach taken by virtually almost every other state in the country.

Who Will Be Required to File an Annual Report?

The new annual reporting requirement will apply to (i) all registered foreign associations and (ii) the following Pennsylvania domestic business entities:

• business corporations;
• nonprofit corporations;
• limited liability partnerships;
• electing partnerships that are not limited partnerships;
• limited partnerships (including limited liability limited partnerships);
• limited liability companies (LLCs);
• professional associations; and
• business trusts.
• all registered foreign associations

When Does the Annual Report Filing Requirement Take Effect?

2024. However, Act 122 includes a phase-in period of administrative penalties for failing to file annual reports until 2027 (see below for further discussion).

What Are the Filing Deadlines?

What Information Will the Annual Report Include?

The annual report will include the following:

• business name;
• jurisdiction of formation;
• registered office address;
• name of at least one director, member or partner;
• names and titles of the principal officers;
• address of the principal office; and
• entity number issued by the Pennsylvania Department of State.

What is the Cost of Filing the Annual Report?

Can Annual Reports be Filed Online?

Yes, annual reports can be filed online at Business Filing Services: https://file.dos.pa.gov.

What Are the Consequences of Failure to File an Annual Report?

Act 122 includes a phase-in period of administrative penalties for failing to file annual reports until 2027. Beginning in 2027, entities that fail to file annual reports will be subject to administrative dissolution/termination/cancellation.

If a domestic filing entity fails to file its annual report and finds that it has been dissolved/terminated, it may file an application for reinstatement, which must be accompanied by the required reinstatement fee and a fee for each delinquent annual report that was not previously paid. On the other hand, once a foreign registration has been terminated, the foreign association may not cure retroactively by reinstating, but instead must reregister by submitting another Foreign Registration Statement. If another entity has taken the name of the entity seeking reinstatement, the entity that has taken the name may keep the name and the entity seeking reinstatement must choose a new name.

 

 

 

Matthew C. Cooper is an attorney at MacElree Harvey specializing in business and corporate law. He counsels businesses of various sizes and industries through all stages of the business life cycle, including representing management and boards of directors by helping them stay compliant with the ever-changing landscape of corporate law. Matthew frequently represents businesses in private financings and mergers and acquisitions, and is a trusted adviser to lenders and borrowers in commercial lending transactions. If you have any corporate or business law needs, please contact Matthew C. Cooper at (610) 840-0279 or [email protected].