Requirement to Report Beneficial Ownership Information (BOI) to Federal Government
Beginning January 1, 2024, the federal Corporate Transparency Act (CTA) requires corporations, limited liability companies, and other similar entities created or registered to do business in the United States to report information to the U.S. government about who ultimately owns and controls them. The CTA is intended to help prevent and combat money laundering, terrorist financing, corruption, and tax fraud. Unless exempt, these entities must file beneficial ownership reports with the Financial Crimes Enforcement Network (FinCEN), a bureau within the U.S. Department of the Treasury. Reporting deadlines vary (see below). Check the FinCEN website https://www.fincen.gov/boi for details about the applicable exemptions and deadlines as well as to file a BOI report with the U.S Beneficial Ownership Information Registry. Significant penalties may apply for failure to submit the required BOI information on time. There is no fee to file a report.
Twenty-three types of entities are exempt from the beneficial ownership information reporting requirements. These entities include publicly traded companies, non-profits, and certain large operating companies. FinCEN’s Small Entity Compliance Guide includes checklists for each of the twenty-three exemptions that may help determine whether your company qualifies for an exemption. Please review Chapter 1.2 of the Guide for more information.
· If your company was created or registered prior to January 1, 2024, you will have until January 1, 2025, to report BOI.
· If your company was created or registered on or after January 1, 2024, and before January 1, 2025, you must report BOI within 90 calendar days after receiving actual or public notice that your company’s creation or registration is effective, whichever is earlier.
· If your company was created or registered on or after January 1, 2025, you must file BOI within 30 calendar days after receiving actual or public notice that its creation or registration is effective.
Beneficial ownership information reporting is not an annual requirement. A report only needs to be submitted once, unless the filer needs to update or correct information. Any updates or corrections to beneficial ownership information that you previously filed with FinCEN must be submitted within 30 days.
Generally, “reporting companies” must provide four pieces of information about each beneficial owner:
1. Name;
2. Date of birth;
3. Address; and
4. Identifying number and issuer from either a non-expired U.S. driver’s license, a non-expired U.S. passport, or a non-expired identification document issued by a State (including a U.S. territory or possession), local government, or Indian tribe. If none of those documents exist, a non-expired foreign passport can be used. Moreover, an image of the document must be submitted.
The company must also submit certain information about itself, such as its name and address. In addition, reporting companies created on or after January 1, 2024, are required to submit information about the individuals who formed the company (“company applicants”).
https://www.fincen.gov/sites/default/files/shared/BOI_FAQs_QA_01.12.2024.pdf
https://www.fincen.gov/sites/default/files/shared/BOI_Small_Compliance_Guide
