BENEFICIAL OWNERSHIP INFORMATION REPORTING
BENEFICIAL OWNERSHIP INFORMATION REPORTING?
In September of 2022, the Financial Crimes Enforcement Network (FinCEN) issued a final rule implementing the bipartisan Corporate Transparency Act’s (CTA) beneficial ownership information (BOI) report. The rule will enhance the ability of government agencies to protect national security and financial systems from illicit use and help prevent drug traffickers, fraudsters, and other criminals from laundering or hiding money in the United States.
The new rule describes who must file a BOI report, what information must be reported, and when a report is due. Specifically, the rule requires Corporations and Limited Liability Companies to file reports that identify the beneficial owners of the entity and the company applicants of the entity.
JANUARY 1, 2024
New businesses that are formed on or after this day must file within 90 days of business formation
JANUARY 1, 2024
FinCEN will begin accepting BOI reports
JANUARY 1, 2024
Existing businesses that were formed before this day must file before January 1, 2025
BIO REPORT?
Tax Practitioner PRO can facilitate filing the BOI report on behalf of your business for only $200 per entity.
Follow these 3 easy steps
- Click the button to fill out the form
- Start gathering all the necessary information. Here’s a list of the required information we will request:
APPLICANT OR BENEFICIAL OWNER INFORMATION: Legal full name, date of birth, residential or business street address, and personal identification document with a unique identifying number, like a driver’s license or passport.
COMPANY INFORMATION: Legal company name, any DBAs or trade names, business address, formation jurisdiction, and identification including Taxpayer Identification Number, Social Security Number, or Employer Identification Number (EIN). Spread the word. This new report is a FinCEN requirement, and if not filed by the due date, it comes with fines and criminal consequences.
Beneficial Owner Information Report FAQs
A company applicant is a person who physically or electronically files a business registration application with the state to form an LLC, Corporation, or other legal entity or who files an application to register a non-U.S. to conduct business in the United States.
If more than one individual is involved in the reporting company’s formation filing process, both the person who directly filed the formation document and the individual who helped direct or control the filing must be included in the BOI report.
No. Only domestic reporting companies created on or after January 1, 2024, and foreign reporting companies first registered to do business in the U.S. on or after January 1, 2024, must include their company applicants in their BOI report.
Reporting companies must include the following information about their business entity:
- Legal name
- DBAs or trade names
- A principal business address in the U.S.
- Formation or registration jurisdiction (state, tribal, or foreign)
- Federal taxpayer ID number (TIN, Social Security Number, EIN)
The information they must provide about their beneficial owners and company applicants include:
- The individual’s full legal name
- Date of birth
- Residential street address (Company applicants may use the business address in some instances).
- Personal identification number and issuing jurisdiction from a non-expired U.S. passport, state driver’s license, or other ID document issued by a state, local government, or tribe — also an image of the ID document. (Individuals may use a foreign passport if they don’t have any other forms of ID.)
To streamline the report filing process, reporting companies, beneficial owners, and company applicants can obtain a FinCEN identifier, which eliminates the need to enter some of the specific details within the BOI report.
A FinCEN identifier is a unique number assigned upon request to a reporting company, beneficial owner, or company applicant. Reporting companies can use FinCEN identifiers to simplify and streamline completing their BOI forms. No one is required to obtain a FinCEN identifier.
A reporting company can request one by checking the designated box on its BOI report. Individuals may request a FinCEN identifier through an electronic application.
You’ll file your BOI report through FinCEN’s secure filing system, which will be available starting January 1, 2024. From that date forward, you can find instructions and technical guidance in the BOI section of the FinCEN website.
No. However, if information about your reporting company or its beneficial owners has changed, you may have to issue an updated report.
FinCEN requires reporting companies to file an updated report within 30 calendar days of when a relevant change occurs or when they realize they provided inaccurate information in their BOI report.
Indeed, there are! There could be civil penalties of up to $500 per day for each day a BOI report is late. Willful failure or attempt to provide false or fraudulent beneficial ownership information could bring criminal penalties, including imprisonment for up to two years and/or a fine of up to $10,000.
FinCEN will keep all the information it collects in a secure database. The information will not be publicly available. Federal, state, local, tribal, and foreign government officials may request to obtain beneficial ownership information for authorized activities related to national security, intelligence, and law enforcement. If the reporting company consents, financial institutions may have access to beneficial ownership information under certain circumstances.
Ultimately, reporting companies are responsible for filing their beneficial ownership information report and certifying the information is complete and correct. Any individual who files the BOI report as an agent of the reporting company certifies it on the entity’s behalf.
If you need help determining whether you must file a BOI report or identifying who must be reported as beneficial owners or company applicants, consider getting guidance from an accountant or attorney.
And if you don’t feel confident preparing and filing the report on your own, Tax Practitioner PRO is here to act as your agent and file the report on your company’s behalf.