2024 New Federal Reporting Requirement for Business Entities 

Beneficial Ownership Information Reports (BOI)

What is the new requirement?

  • The U.S. Treasury Department’s Financial Crimes Enforcement Network (FinCEN) has asked companies to report information about the people who own or control the business, the company’s beneficial owners.

Who is considered a beneficial owner?

  • A beneficial owner is any individual who has primary control over the reporting company or who owns at lease 25% of the reporting company.

When was this requirement enacted?

  • As of January 1, 2024.

How long do I have to file this report?

  • If your company was created or registered prior to January 1, 2024, you have one year to file the initial report with FinCEN, until January 1, 2025.
  • If your company was created or registered on or after January 1, 2024, you have 90 calendar days after receiving notice of its creation or registration. 
  • If your company is created or registered on or after January 1, 2025, you will have 30 calendar days to file after receiving notice of its creation or registration.

What happens if I do not file within the required time?

  • Owners who don’t comply could face serious fines and other penalties. People who knowingly violate the requirements may face civil penalties of up to $500 each day the offense persists and criminal penalties of up to two years imprisonment and a fine of up to $10,000.

Why is this a new rule?

  • FinCEN works to protect the U.S. financial system from fraud, corrupt officials, money laundering, amongst other financial crimes.
  • In order to help address these problems, Congress passed the Corporate Transparency Act. By collecting BOI, this will make it harder for criminals to act in bad faith and help heighten national security.

Why does my company need to report BOI?

  • Although your company is a legitimate business, criminals can use companies to provide cover for tax evasion, money laundering, drug trafficking, amongst other crimes. These illegal activities hurt innocent and hardworking businesses. By reporting BOI, you are aiding FinCEN in safeguarding our financial system. 

Are all companies required to report?

  • While most businesses are required to report there are certain types of entities, specifically twenty-three categories, that are exempt. You can find the list of exempt entities here. 

What information will my company need to provide to FinCEN?

  • A reporting company will need to provide:
    • Legal name and any trade names or Doing Business As (“DBA”).
    • Address
    • The jurisdiction in which your company was form or first registered (U.S. or foreign company)
    • Tax Identification Number (TIN)
    • Individuals that formed the company (“company applicants”).
  • For each company’s beneficial owners and company applicants the reporting company will need to provide the following information of each individual:
    • Legal name
    • Birthdate
    • Address (can be home address in most cases)
    • The identifying number from an approved document (driver’s license, passport, etc.) along with an image of that approved document 

What is a company applicant?

  • The company applicant is an individual who files the document. This applicant either creates or registers the company. There are two types of individuals who can qualify as a company applicant:
    • The person who directly files the document that first created or registered the reporting company; and
    • If there is more than one person involved in the creation or registration, the person who qualifies is the one who is primarily responsible for directing or controlling that filing.

Does my company need to report its company applicants?

  • What is a company applicant?
    • A company applicant is an individual who files an application to form an entity such as an LLC or corporation.
    • Your company has to report its company applicants only if your company is created or registered on or after January 1, 2024. 

How can I report?

  • You can file your report electronically using FinCEN’s secure filing system here.
  • Your private information is secure with FinCEN and will only be shared with authorized users for purposes specified by law.

Can my attorney file my BOI on my behalf?

  • Yes, we sure can! Please contact us for further information in relation to BOI filing on your behalf.
  • Anyone the reporting company authorizes to act on its behalf (employee, owner or third party service provider) may file the BOI report on the reporting company’s behalf.

Where can I find more information?

  • You can contact Tannehill Law or FinCEN’s official website for any questions or to learn more about this new requirement or any other legal matters.