Governor Hochul Veto Keeps New York LLC Transparency Act Limited to Foreign Country Formed, NY Authorized LLCs

Governor Hochul’s veto memo can be found here. Governor Hochul explains her disapproval of the bill as follows:

The legislation would modify the LLC Transparency Act, in light of changes to the federal Corporate Transparency Act (CTA). The LLC Transparency Act was enacted to ensure that the state would receive reporting similar to that which is required under the federal CTA, thereby ensuring transparency regarding ownership while not placing additional burdens on limited liability companies (LLCs). Since the LLC Transparency Act was passed, the Federal Government has established new reporting criteria, limiting requirements under the CTA. This bill would create a mandate for businesses in New York that is not required under federal law.

As the LLC Transparency Act is implemented next year, we want to ensure that those required to provide updated reporting, continue to do so, but imposing additional requirements on LLCs is not in the interest of New York State. Therefore, I am constrained to veto.

The bill is disapproved.

This means that, when it goes into effect (January 1, 2026, for newly formed LLCs and January 1, 2027, for pre-existing LLCs), the New York LLC Transparency Act will apply solely to LLCs formed under the laws of a foreign country that are authorized to do business in New York. The vetoed bill would have decoupled New York from the federal anchoring definitions under the CTA. Importantly, these federal anchoring definitions were significantly revised by the Financial Crimes Enforcement Network’s interim final rule announced on March 26, 2025, which drastically reduced the CTA’s scope to apply solely to reporting companies formed under foreign country law.

For more information on the New York LLC Transparency Act, please read our previous alert here.