Since the Corporate Transparency Act (“CTA”) went into effect earlier this year many Certified Public Accountants (“CPAs”) have been hesitant to assist clients with CTA compliance. This hesitancy stems, at least in part, from a concern that doing so may constitute the unauthorized practice of law.

Recently, the State Board of Public Accountancy requested an opinion from the Maryland Attorney General as to whether CPA assistance with the beneficial ownership information reporting (“BOIR”) requirement of the CTA would constitute the unauthorized practice of law. In its opinion, the Attorney General considered how the courts might assess this question. Although it does not contain bright-line rules, the opinion analyzed several BOIR-related services CPAs might consider offering, and is among the most instructive guidance on this point available.

In the opinion, the Attorney General concludes that the following activities by CPAs would likely not be viewed as the unauthorized practice of law:

• Informing clients about the existence of the CTA and the need to comply with BOIR requirements;

• Answering general questions regarding the CTA or BOIR requirements without tailoring the information to the client’s particular situation;

• Pointing a client to guidance published by FinCEN; and

• Gathering information about a client’s beneficial owners and filling out and filing a BOIR form for a client where the client determined for itself that it is a reporting company and provides the CPA a list of its beneficial owners.

The opinion also indicates that in some situations a CPA could probably help a client determine if it is a “reporting company” or identify its “beneficial owners” under the CTA (and intimates that CPAs could possibly help identify “company applicants” or determine if a person is exempt from “beneficial owner” status) by undertaking the following activities:

• Walking the client through instructions published by FinCEN (e.g., in FinCEN’s Small Entity Compliance Guide), which were designed for use by non-lawyers, and recording the client’s answers;

• Defining terms that are familiar to non-lawyers or to CPAs from their own training and expertise; and

• Answering the client’s questions if doing so does not require legal knowledge or skills.

However, the Attorney General acknowledged that these activities are “closer to the line” of unauthorized practice of law, as they would require the CPA to apply the law to a client’s particular circumstances. On this point, the opinion cautions that “a CPA generally should not answer a BOIR-related question for a client where there is uncertainty as to the answer and resolving that uncertainty would require legal knowledge, skill, and judgment.”

While the Attorney General’s opinion provides comfort that there are some CTA compliance services CPAs likely can provide, as a practical matter, CPAs may find that permissible engagements for CTA-related services have a tendency to evolve naturally into more questionable or even impermissible activities with respect to the unauthorized practice of law. Some CPA’s therefore may continue to avoid involvement with CTA compliance altogether. As with law firms, for CPAs that wish to provide clients CTA related services, a clear scope of engagement defining with specificity the activities the CPA will (and will not) undertake is advisable.