As of January 2024, many U.S. business owners are facing a new federal filing requirement under the Corporate Transparency Act (CTA). If you own a small business, including an LLC used to hold real property, it’s highly likely this regulation applies to you. Failing to comply could result in significant penalties. Here’s what you need to know about filing the Beneficial Ownership Information Report (BOIR) with the Financial Crimes Enforcement Network (FinCEN).
What is the Beneficial Ownership Information Report (BOIR)?
The BOIR is a mandatory filing designed to disclose information about individuals who own or control a company—referred to as "beneficial owners." This filing helps FinCEN combat illicit activities like money laundering, fraud, and terrorism financing.
Who Needs to File? Most U.S. businesses are required to file a BOIR. This includes:
LLCs
Corporations
Similar entities formed under state or tribal laws
If you own or manage a business entity, it’s your responsibility to ensure compliance. Note that even holding companies or LLCs used solely for owning property must file unless they qualify for a specific exemption.
Filing Deadlines. Timely filing is crucial to avoid penalties. Deadlines vary based on your company’s formation date:
For Companies Formed in 2024: You must file your BOIR within 90 days of formation.
For Companies Formed in 2025 or Later: The filing window is reduced to 30 days after formation.
What About Dissolved Companies?
Even if your company was dissolved or merged in 2024, you are still required to file the BOIR if the company existed for any part of the year. FinCEN has clarified that reporting obligations begin at the point of formation and continue until all required reports are submitted.
Consequences of Non-Compliance. The penalties for failing to file or providing false information are severe:
Civil Penalties: Fines of up to $500 per day for non-compliance.
Criminal Penalties: Willful violations can lead to criminal charges, including potential imprisonment for responsible individuals.
What Information Must Be Reported?
Each BOIR must include the following details about every beneficial owner:
Full Legal Name
Date of Birth
Residential or Business Address
Unique Identifying Number (e.g., from a passport or driver’s license)
Take Action to Ensure Compliance. The Corporate Transparency Act imposes new responsibilities, but with proper guidance, compliance doesn’t have to be overwhelming. Here’s how you can prepare:
Identify Beneficial Owners: Determine who meets the beneficial ownership criteria for your company.
Gather Required Information: Collect the necessary details to file accurately.
File Your BOIR on Time: Submit your report through FinCEN’s secure online system by the applicable deadline.
Unsure if This Applies to Your Business?
Navigating new regulations can be challenging, especially if you’re unsure whether your business qualifies for an exemption or how to gather the required information. That’s where we come in. Our experienced team can help you:
Understand the CTA’s requirements
Determine your filing obligations
Prepare and submit your BOIR correctly and on time
Don’t Risk Penalties – Take Action Today.
With penalties as high as $500 per day and potential criminal charges, failing to comply with the Corporate Transparency Act can have serious consequences. If you’re unsure where to start or need professional assistance, contact us to ensure your business meets all federal requirements.
By acting promptly, you can protect your business and avoid unnecessary complications. Reach out today to get the guidance you need!
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