You may have a Beneficial Ownership Report (BOI) due by December 31, 2024 or incur substantial penalties for failure to file. This process is not covered under the tax code or under any standard accounting practice; therefore, we cannot file on your behalf. While it may be worthwhile for you to engage an attorney to complete this filing, we wanted to give you the basic information needed for you to file yourself.
We recommend that you complete this filing immediately should you have questions ahead of the holidays.
If you have further questions, we recommend you consult fincen.gov/boi, or speak with an attorney.
With the passing of the CTA (Corporate Transparency Act) by Congress on January 1, 2021, businesses are now required to report beneficial business relationships to the FinCEN (Financial Crimes Enforcement Network).
Reporting companies that are required to file include:
- Domestic reporting companies – corporation, limited liability companies, sole proprietors and any other entities created by the filing of a document with a secretary of state or any similar office in the United States.
- Foreign reporting companies – entities (including corporations and limited liability companies) formed under the law of a foreign country that have registered to do business in the United States by the filing of a document with a secretary of state or any similar office.
See reporting requirement outlined in the FinCEN Small Entity Compliance Guide or the FinCEN BOI FAQs.
Filing Exemptions:
The Reporting Rule exempts (23) specific types of entities from the reporting requirements (See table on section 1.2 of Small Entity Compliance Guide), with the most common being #21 – Large Operating Company. A Large Operating Company meets all of the following criteria per FinCEN:
- Entity employs more than 20 full time employees who are employed in the United States
- Entity has an operating presence at a physical office within the United States
- Entity filed a Federal income tax return for the previous year demonstrating more than $5,000,000 in gross receipts or sales (excluding Foreign Source Income)
Filing Due Dates:
For businesses filed with the Secretary of State any time prior to January 1, 2024, a formal filing of BOI (Beneficial Ownership Information) is required to be submitted to the FinCEN no later than January 1, 2025.
For businesses created in 2024, you must complete your BOI filing within 90 days after creation.
For businesses created in 2025 or later, you have only 30 days from creation.
If your business is not exempt, you must file a BOI Report timely or be subject to civil penalties of $591 per day the violation continues and/or criminal penalties of up to $10,000 and up to 2 years of imprisonment for willful violations. Penalties, liabilities and violations are outlined in both the FinCEN Small Entity Compliance Guide and the FinCEN BOI FAQs.
This is a one-time initial filing requirement, unless any changes to Beneficial Ownership or Reporting Company Information are made. An updated BOI report must be filed within 30 days after a change occurs. See the FinCEN Small Entity Compliance Guide or the FinCEN BOI FAQs, for what changes may require an updated report.
Information Needed to File:
Reporting companies need to report a few pieces of information about themselves and their beneficial owners and their company applicants.
- Company information needed: This includes but is not limited to, legal name and DBA, address, jurisdiction, TIN/EIN and whether it is an initial or updated report.
- Beneficial owners and/or company applicants information needed: This includes but is not limited to, legal name, date of birth, residential address, copy of driver’s license or passport.
See the FinCEN Small Entity Compliance Guide or the FinCEN BOI FAQs, for which beneficial owners and other information may need to be reported, especially if you are a foreign entity or have foreign owners.
Filing Your BOI Report:
Reporting companies report beneficial ownership information electronically through FinCEN’s BOI website or more specifically the BOI E-filing system. The BOI Homepage also includes a 5-minute demo YouTube video among other links and resources to help reporting companies navigate filing. The system will provide a confirmation of receipt once a completed report is filed with FinCEN.
If you have further questions, we recommend you consult FinCEN.gov/boi or reach out to our office or your attorney.