Beginning January 1, 2024, many companies that do business in the U.S. must report “beneficial ownership information” (BOI) to the Financial Crimes Enforcement Network (FinCEN). BOI consists of identifying information about individuals who own or exercise substantial control over the business entity, either directly or indirectly.
To meet this new reporting obligation, companies must complete and submit a new electronic form available on the FinCEN website (link below). Entities that must file the reporting form include many domestic and foreign corporations, LLCs and companies created by filing documents with a secretary of state or similar officer. However, 23 types of entities are exempt from the BOI reporting requirement, including many banks, credit unions and insurance companies.
A reporting company founded or registered before January 1, 2024 will have until January 1, 2025 to file its initial BOI report. Reporting companies established on or after January 1, 2024 must file within 30 days after the company’s creation or registration becomes official. Failure to file a BOI reporting form in a timely manner, or to update it when ownership information changes, may trigger significant civil or criminal penalties. As specified in the Corporate Transparancy Act, a person who willfully violates the BOI reporting requirements may be subject to civil penalties of up to $500 for each day that the violation continues. That person may also be subject to criminal penalities of up to two years imprisonment and a fine of up to $10,000. Potential violations include willfully failing to file a beneficial ownership information report, willfully filing false beneficial ownership information, or willfully failing to correct or update previously reported beneficial ownership information.
If you would like Cornerstone Tax Services to file and complete the FinCEN requirements for your business, please reach out to us via email at email@example.com, with the subject line “FinCEN Business Filing Request”.
For more information regarding the FinCEN requirements, you can visit the FinCEN website at the following link: fincen.gov/boi