The Corporate Transparency Act (CTA) introduced new Beneficial Ownership Information (BOI) filing requirements, impacting many U.S. businesses. As an accounting advisory firm, we understand that staying compliant with evolving regulations is essential—but it can also be complex.
This article breaks down what business owners need to know about BOI filing in a straightforward manner, focusing on financial compliance rather than legal interpretation.
What is a BOI Filing?
BOI filing is a federal reporting requirement mandating certain corporations, limited liability companies (LLCs), and other similar entities to disclose their beneficial owners—individuals who own or control the company– to the FinCEN.
This information includes details about individuals who own or control 25% or more of the entity or have significant influence over its operations.
The primary objective is to enhance corporate transparency and prevent financial crimes such as money laundering.
For full details on this requirement, visit the FinCEN Beneficial Ownership Information Reporting page.
Who Needs to File?
Many businesses, including LLCs, corporations, and similar entities, must submit a BOI report unless they qualify for an exemption. Some of the most common exemptions include:
- Large operating companies with more than 20 employees and over $5 million in revenue
- Banks and credit unions
- SEC-registered investment firms
- Insurance companies
- Tax-exempt organizations
While some larger companies and highly regulated entities are exempt, most small businesses and newly formed entities must file. If you’re unsure whether your business qualifies, check the FinCEN BOI FAQs for further clarification.
BOI Filing Requirements
What Information Needs to Be Reported?
If your business is required to file, you will need to submit:
- Company Information: Name, principal address, and Taxpayer Identification Number (TIN/EIN).
- Beneficial Owner Information: Any individual with at least 25% ownership or substantial control over the business.
- Owner Identification: Full legal name, date of birth, current residential address, and a government-issued identification number (e.g., passport or driver’s license).
For step-by-step guidance, refer to the BOI Filing Instructions provided by FinCEN.
BOI Filing Deadlines
- For existing businesses formed before January 1, 2024: The deadline to file is January 1, 2025.
- For new businesses formed in 2024: The deadline is within 90 days of business formation.
- For businesses formed on or after January 1, 2025: The deadline will be within 30 days of formation.
How This Impacts Business Owners
- Non-compliance can result in penalties from the Financial Crimes Enforcement Network (FinCEN).
- BOI reports are not public records, but the government will use them for regulatory and enforcement purposes.
- Your accountant can help ensure accurate reporting by maintaining proper financial records and ownership details.
Next Steps for Business Owners
- Determine if your business must file a BOI report.
- Gather the necessary ownership and company information.
- Consult with an accountant or compliance expert to ensure financial and regulatory accuracy.
- File before the deadline to avoid potential penalties.
At Beckley & Associates PLLC, we help businesses stay compliant with financial regulations, including BOI reporting requirements. While BOI filing has legal aspects, we focus on helping you maintain accurate financial records to meet regulatory obligations.
Need Assistance?
If you have questions about how BOI filing applies to your business, we’re here to help. Contact us today.