New York’s LLC Transparency Act (the “Transparency Act” or “the Act”) is rapidly approaching its effective date of January 1, 2026. However, its requirements remain up in the air. There was considerable uncertainty interjected into the Act’s requirements when, in March 2025, the Department of Treasury’s Financial Crimes Enforcement Network (“FinCEN”) changed the federal regulations that are incorporated by reference into the Transparency Act. The New York legislature sought to clarify the Act’s scope by passing S.8432 (the “2025 Bill”), but the governor has not yet taken action on that bill. On December 8, that bill was delivered to the governor, and she will have until December 19 to sign the bill outright, sign the bill with a “chapter amendment” (which could effectively amend the bill), veto it, or not take action, which would let the bill come into effect.
The governor’s imminent decision will help provide clarity for how companies should prepare to come into compliance with the Act. Given the significant uncertainty around the status of the law and the potential for changes, companies that have LLCs formed or registered to do business in New York should continue to monitor for further developments.
Where the Law Stands Today
On March 1, 2024, New York governor Kathy Hochul signed Senate Bill S.8059, which amended the state’s LLC law to require certain LLCs (“reporting companies”) to report beneficial ownership information to the New York Department of State.[1] Specifically, the Act requires non-exempt LLCs that are either organized under New York Law or authorized to do business in New York to report certain beneficial ownership information to the New York Department of State.
The Act currently defines core concepts—including “reporting company” and “beneficial owner”—by reference to the federal Corporate Transparency Act (“CTA”) and its implementing regulations, issued by FinCEN.[2] At the time the law was enacted, FinCEN was in the process of establishing regulations that would require a significant number of legal entities to file beneficial ownership reports with FinCEN. New York’s Transparency Act, in effect, mirrored the federal regulatory scheme by requiring New York LLCs to file similar reports with the New York Department of State.
However, in March 2025, FinCEN substantially revised its beneficial ownership rules, eliminating reporting requirements for domestic reporting companies and narrowing the definition of a “reporting company” to entities formed under the law of a foreign country that have registered in the United States.[3] Because New York’s Transparency Act defines “reporting company” by reference to the CTA, LLCs formed in any U.S. jurisdiction may no longer have filing obligations under New York’s LLC law in its current structure. The New York State Department of State has not yet issued any guidance clarifying how to interpret the Transparency Act in light of these issues.
Following the change in federal regulations, the New York State Senate and Assembly passed S.8432 (the “2025 Bill”) in June 2025.[4] This bill would decouple the Transparency Act’s key definitions—“reporting company,” “beneficial owner” and “exempt company”—from federal law in order to maintain disclosure requirements for domestic LLCs.[5] Specifically, the 2025 Bill would redefine “reporting company” to mean (1) LLCs formed by filing with the New York Department of State or (2) authorized to do business in New York as a foreign LLC. It would also codify the CTA’s 23 exemptions directly into New York law, rather than incorporating them by reference to FinCEN’s regulations.
On December 8, the bill was delivered to the governor, which means she then has 10 days (excluding Sundays) to take action on the bill.[6] The governor may sign the bill, veto the bill or sign the bill conditional on “chapter amendments,” which effectively permit the governor to amend the bill. A chapter amendments can be technical or more substantial in scope. If the governor does not take any action on the bill by December 19, it would become law.
Possible Regulatory Frameworks Based on the Governor’s Decision
The regulatory regime will be significantly impacted by whether or not the governor signs the 2025 Bill into law:
- 2025 Bill Is Enacted: If the governor signs the Bill into law or lets it become law, it would establish a reporting regime that will be largely consistent with FinCEN’s regulations prior to the March 2025 changes.
- Under the regime, non-exempt LLCs formed or registered to do business in New York would be required to identify their beneficial owners and company applicants (who file the registration papers) and file relevant information with the New York Department of State.[7] Unlike the FinCEN regulations, there is no equivalent to a “FinCEN ID,” which means that the LLCs would need to disclose their personal information directly in their filing.
- A beneficial owner would be defined as an individual who “exercises substantial control over the entity” or “owns or controls” 25% or more of the entity’s “ownership interests.”
- Certain exemptions would apply, similar to those in the prior FinCEN regulations. This would include exemptions for, among other things, large operating companies (i.e., any entity with more than 20 employees in the United States, federal tax returns of more than $5 million and an office in New York); publicly traded companies (securities reporting issuers); registered investment advisers; pooled investment vehicles; and subsidiaries of certain exempted entities. Unlike under the FinCEN regulations, an exempt entity would need to submit an attestation of its exempt status with the factual basis for the exemption.[8]
- This would create a complex regulatory framework—similar to what had been in place under FinCEN’s prior beneficial ownership regulations—that would require fact-intensive analysis of relevant exemptions and ownership structures. We expect that the New York Department of State would need to issue guidance clarifying the scope of these requirements given that the 2025 Bill still does not clarify some of the core issues in the law, including the definition of “substantial control.”
- 2025 Bill Is Not Enacted: If the 2025 Bill is vetoed by the governor, the Transparency Act may remain limited in its application and, as a technical matter, would only require filings from non-U.S. LLCs. We expect that at some point the New York Department of State would issue guidance.
Furthermore, as noted, the governor could sign the bill into law through a “chapter amendment,” which could require substantial changes to the law.
Timing Requirements
If the 2025 Bill is signed and the requirements do become effective, non-exempt LLCs that are formed in or authorized to do business in New York would need to submit filings under the following timeline:
- An LLC formed or registered to do business in New York prior to January 1, 2026, would have until January 1, 2027, to file.[9]
- An LLC formed or registered to do business in New York on or after January 1, 2026, would have 30 days from registration to file.[10]
For LLCs incorporated in another state but registered to do business in New York (such as a Delaware LLC), the timeline is tied to the date of New York registration or authorization. In effect, a preexisting Delaware or other LLC that first registers in New York in 2026 would be on the 30‑day timeline.
Practical Steps
Given the significant uncertainty in the law, companies that have New York-registered or -authorized LLCs should continue to monitor further developments, including the governor’s action on the 2025 Bill and any statements from the New York Department of State. Ultimately, even if the 2025 Bill is enacted, companies would still have a significant amount of time (until January 1, 2027) to make any filings for preexisting companies, but may need to be prepared on a quicker timeframe to take steps to make filings for any newly created LLCs that fall within the reporting requirements.
We will continue to monitor for developments regarding the Transparency Act and provide relevant updates.
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[1] Senate Bill S8059, New York State Senate, available here.
[2] 2024 N.Y. Laws ch. 102.
[3] FinCEN Removes Beneficial Ownership Reporting Requirements for U.S. Companies and U.S. Persons, Sets New Deadlines for Foreign Companies, Financial Crimes Enforcement Network (Mar. 21, 2025), available here.
[4] Senate Bill S8432, New York State Senate, available here.
[5] S.8432, 2025-2025 Leg. Sess. (N.Y. 2025); Assemb. 8662-A, 2025-2026 Leg. Sess. (N.Y. 2025).
[6] Senate Bill S8432, New York State Senate, available here.
[7] This would include the person’s full legal name, date of birth, street address (residential or business) and unique ID number from a government-issued ID (such as a passport or driver’s license).
[8] Limited Liability Company Law § 1107(b).
[9] Limited Liability Company Law § 1107(e).
[10] Limited Liability Company Law § 1107(d).
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