New Annual Report Requirements for Certain Pennsylvania Entities Begins in 2024

Pennsylvania Act 122 became effective on January 2, 2023, resulting in several amendments to Title 15 Corporations and Unincorporated Associations. Act 122 repealed PA’s ten-year cycle “decennial” reporting regime for certain entities and replaces it with an annual reporting requirement that will begin in January 2024.

Under previous law, entities or associations formed, organized or incorporated under the laws of the Commonwealth and non-PA entities registered in the Commonwealth were not required to make annual or biennial filings with the Bureau of Corporations and Charitable Organizations (the “Corporation Bureau”) to confirm their continued existence. Instead, entities were required to file a decennial report on a rolling ten-year basis (2001, 2011, 2021, etc.) unless the entity had made certain kinds of filings with the Corporation Bureau within the previous ten-year cycle.

Act 122 amends Title 15 to repeal the old system and replace it with Section 146, an annual reporting requirement, like most other states. The new annual report requirement is, in part, an effort to clean up the entity rolls of the Corporation Bureau, which it estimates to have hundreds of thousands of entities listed as being “active” (since they have never been formally dissolved or terminated)—many of which are likely no longer operating.

After the new annual reporting system comes fully into effect following a four-year education and phase-in period (discussed below), entities that are not active will be subject to administrative dissolution, and more names will more quickly become available for use by other entities.

Who will be required to file an annual report?

With some exceptions, this requirement will apply to most entities formed under the laws of the Commonwealth that must file something with the Corporation Bureau to exist (for instance, a corporation that files articles of incorporation) and all non-PA businesses registered or qualified to do business in the Commonwealth. The required filers are:

• “domestic filing entit[ies]” (any entity the internal affairs of which are governed by the laws of the Commonwealth and that must file a public record with the Corporation Bureau to be formed), which includes (among others):
  • business corporations,
  • non-profit corporations,
  • LLCs,
  • limited partnerships, and
  • professional corporations

but excludes general partnerships unless they are limited liability partnerships or electing partnerships, as described below.

• “domestic limited liability partnerships” (a PA general partnership registered under Chapter 82),
• “domestic electing partnership[s]” (a partnership that has elected to be governed by Chapter 87), other than limited partnerships (which are “domestic filing entities” anyway), and
• “registered foreign associations” (non-PA entities registered to do business in the Commonwealth).

When does the annual report filing requirement take effect?

The annual reporting regime begins on January 3, 2024, and annually thereafter.

What are the filing deadlines when the reporting obligation starts?

What will the contents of the report be?

Annual reports must be delivered to the Corporation Bureau for filing, signed by the entity, and include the following information, which must be accurate as of the filing date:

1. the name and jurisdiction of formation;
2. subject to section 109 (relating to the name of commercial registered office provider in lieu of registered address), the address of its registered office, if any, including street and number, if any, in this Commonwealth;
3. the name of at least one governor (a director of a corporation, a manager of a manager-managed LLC, etc.);
4. the names and titles of the persons who are its principal officers, if any, as determined by its governors;
5. the address of its principal office, including street and number, if any, wherever located; and
6. its entity number or similar identifier issued by the PA Department of State.

If an annual report includes a registered office different from the Corporation Bureau’s records, the registered address of record at the Corporation Bureau will automatically change to the registered address contained in the annual report.

What will the consequences of failure to file annual reports be?

Act 122 includes a phase-in period of administrative penalties for failing to file annual reports until January 4, 2027. With respect to annual reports due on or after January 4, 2027, if an entity or association fails to file an annual report, it will be subject to administrative dissolution under Subchapter 3H (if it is a domestic filing entity), administrative cancellation under Subchapter 3H (if it is a domestic limited liability partnership or electing partnership), or administrative termination of its registration under § 419 (if it is a foreign association).

Will there be notices or reminders of the filing obligation?

Act 122 requires the PA Department of State to deliver a notice to each association or entity obligated to file at least two months before its due date. Even if no reminder is sent, the filing is still due by the due date.

Can annual reports be filed online?

Yes, annual reports can be filed online at Business Filing Services. The Corporation Bureau transitioned to a new records management and online filing system in Q4 of 2022, replacing the SWORD legacy database and PennFile online portal. Business Filing Services include all business entities, Uniform Commercial Code, and trademark filings, as well as all record requests and certificates.

Business Filing Services are accessible at https://file.dos.pa.gov.

Will there be fees for filing annual reports?