BOI: Beneficial Ownership Information Report Filing
In 2024 there is a new requirement for small businesses to file a Beneficial Ownership Information Report (most often referred to as BOI) under the Corporate Transparency Act (CTA).
We’ve compiled all you need to know about filing this report and are happy to assist should you run across any challenges.
Why BOI?
Registration is required to identify owners or key employees of companies.
To uncover illegal activity associated with shell companies or intentionally hiding the ownership of companies.
Who is required to report to BOI?
Domestic reporting companies are corporations, limited liability companies, and any other entities created by the filing of a document with a secretary of state or any similar office in the United States. This includes most non-profits (which might be exempt).
Foreign reporting companies are entities (including corporations and limited liability companies) formed under the law of a foreign country that has registered to do business in the United States by the filing of a document with a secretary of state or any similar office.
Sole Proprietors or General Partners are NOT required to file
When do I need to report?
For entities created before January 1, 2024, you must report no later than January 1, 2025.
For entities created on or after January 1, 2024, you must report within 90 days.
For entities created on or after January 1, 2025, you must report within 30 days.
Who is a beneficial owner?
Owns at least 25% of a company
Or has substantial control over the company – Senior Officer or someone who performs these duties such as CEO, COO, CFO, Controller, etc.
Are there exemptions to filing?
501c organizations
Trusts
Large company exemption – all below must apply to be exempt
Employs more than 20 FT employees (30 hrs per week)
More than 20 FT employees in the United States
Has an operating presence in the United States
A tax return filed in the previous year listing more than $5,000,000 in gross receipts and/or more than $5,000,000 of gross receipts inside the United States.
Inactive entity (all below must apply to be exempt)
Was in existence before January 1, 2020
Businesses not currently engaged in active business
The business is not owned, wholly or partially by a foreign person
No change in ownership over the last 12 months
Has not had any income over $1,000 in the past 12 months
Does not hold any assets in the business, or ownership of other businesses
See the BOI Small Business Compliance Guide for a complete list of companies exempt from filing.
Is there a penalty for not filing?
Willful failure to report BOI may result in civil penalties of up to $500 per day until the report is filed, or criminal penalties of up to two years in prison and a fine of up to $10,000. This applies fines to the company and senior officers.
This is not an optional registration.
Who is the company applicant?
The person who directly completes the application.
The person who directly controls the filing of the application. This could be the same person completing the application.
The applicant can be someone within the company, an accountant, an attorney, or an outside service.
Is the person completing the application required to report?
If the company was created before January 1, 2024, the company applicant is not required to report.
If the company was created on or after January 1, 2024, the company applicant is required to report.
What will I need when I complete the report?
Company level
Name and DBA (if you have a Doing Business As name)
Physical Address
EIN or TIN
Applicant and Beneficial Owner
Full legal name
Date of birth
Current address
Proof of identity – Driver’s license, Passport, or other Government ID. Must not be expired. SSN card is not a valid ID.
Minor children are not required to report, but parent or guardian must be listed.
What is a FinCEN identifier?
In the application process, you will be asked if you want a “FinCEN identifier” which is a unique number (similar to an EIN) for reporting requirements to only FinCEN.
This is optional.
You can get a number for a company, or individuals during the process.
Is this an annual requirement?
Whenever there is a change to the original BOI report, the change must be reported, otherwise no annual requirement is needed.
Changes would include: address change, ownership changes, key leadership changes, DBA, and expiration of any ID document used by the applicant or beneficial owner.
When a minor child reaches 18, if they were not previously reported, they will now be required to report.
There is no requirement to report the closing or dissolving of a company.
If there are any changes, or you become aware of inaccurate information in your report, these must be updated within 30 days of the time of the change or when they became aware of the change.
Remember, we are here to help. This is a new process that you aren’t supposed to be familiar with! If you run into challenges, please reach get connected with an advisor. We are here for you! >> Get matched with an advisor