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In an effort to increase transparency and combat tax evasion, Senators Charles Grassley (R-IA) and Carl Levin (D-MI) introduced legislation on August 1 that would require states to obtain the identities of individuals who organize corporations and other
August 2, 2013
In an effort to increase transparency and combat tax evasion, Senators Charles Grassley (R-IA) and Carl Levin (D-MI) introduced legislation on August 1 that would require states to obtain the identities of individuals who organize corporations and other business entities under their laws. Sen. Grassley is ranking member of the Senate Judiciary Committee and a past chairman of the Senate Finance Committee, and Sen. Levin is the chairman of the Senate Homeland Security and Governmental Affairs Permanent Subcommittee on Investigations (PSI). Senators Dianne Feinstein (D-CA) and Tom Harkin (D-IA) joined Senators Grassley and Levin in sponsoring the bill.
According to a press release issued by the PSI, the Incorporation Transparency and Law Enforcement Assistance Act "would end the practice of the 50 states forming corporations for unidentified persons, and instead require the states to obtain the identities of the persons behind the corporations formed under their laws." In brief, the bill would:
Require states directly or through licensed formation agents to obtain the names of beneficial owners of the corporations or limited liability companies organized under their laws;
Require formation agents that sell shelf corporations to identify the beneficial owners that acquire them;
Require the provision of beneficial owners' names, addresses, and a U.S. driver's license or passport number, or information from a non-U.S. passport; and
Establish penalties for persons who knowingly provide false information, or willfully fail to provide required information, on beneficial ownership.
This is the fourth Congress in which the bill has been introduced. The bill was introduced for the first time in 2008.
The text of the bill.
The press release issued by the PSI.
A summary of the bill.