Attention Business Owners –
Corporate Transparency Act Requires New BOI Report or Face Penalties
The Corporate Transparency Act (CTA) is requiring almost every business to comply with the new Financial Crimes Enforcement Network's BOI reporting requirement, threatening major financial and legal penalties for non-filers.
The Corporate Transparency Act led to the inception of a new government agency – the Financial Crimes Enforcement Network or FinCEN – and they have implemented a new reporting requirement for entities to disclose their Beneficial Ownership Information (BOI).
"Non-compliance with the CTA can lead to substantial penalties, including fines ranging from $500 to $10,000 per violation and imprisonment for up to two years."
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Deadlines for Filing:
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Business entities formed before January 1, 2024 have until December 31, 2024 to file the initial report.
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Business entities formed after January 1, 2024 have 90 days from the date of formation to file the inital report.
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Business entities that will be formed after January 1, 2025 will have 30 days from the date of formation to file the initial report.
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If your business information changes, you'll need to file another BOI report within 30 days of the change.
What Do You Need to Do?
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Determine whether or not your business is affected and needs to file the initial BOI report. Find out here!
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Identify all of the beneficial owners of the business. What is a beneficial owner?
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Collect all of the required information and documentation.
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File your initial BOI report before the deadline!
"This new requirement is catching a lot of small business owners off guard because it's outside the normal scope of what they are used to hearing about and required to file in the past. For instance, if you get married and your name changes as a result - you may need to re-file. If an owner makes certain changes in company management, or moved their family to a new home are among just a few of the reporting requirements ... yet another thing piled on top of small businesses to keep track of and comply with ... or risk heavy fines."
Darin Edwards
President of Propel Small Business Accounting and Compliance
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Information Required for Filing the Report:
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Personal information of each beneficial owner
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Full legal name
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Date of birth
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Address
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Government-issued ID
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Business entity name, EIN, and state
As frustrating as this is to many business owners, the BOI reporting requirement is as unavoidable as death and taxes. Ensure your BOI report is filled out accurately before the deadline to avoid severe penalties.
If you have any questions or need assistance, don't hesitate to give us a call. We're happy to help!
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Still not sure if you need to have a BOI report filed?
Take our quiz to learn if your business is affected!
We'll help you file your report, ensure your business is compliant, and bring you peace of mind knowing you're no longer at risk for major penalties.
Avoid the fines and risks. Let our compliance team protect you and your business!
✅ Risk free
✅ No obligation
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✅ Fulfilled by trusted compliance experts
✅ Saves time and money
What next?
After submitting the form, a compliance specialist will review your business information and reach out to you shortly. They'll help you take the necessary steps to bring your business into compliance.
FinCEN Frequently Asked Questions
Is it necessary for my company to disclose its beneficial owners?
Unless falling under specific exemptions, small corporations or LLCs are likely obligated to disclose their beneficial ownership details to FinCEN. The requirement hinges on whether your company had to submit documentation to the state's secretary of state or a similar authority to establish its existence, or for foreign entities, to register for operations in the United States.
Who qualifies as a beneficial owner of my company?
A beneficial owner is defined as any individual exercising significant control over the company or possessing ownership or control of at least 25 percent of its shares.
Are there obligations for my company to disclose its company applicants?
Up to two individuals may qualify as company applicants: the individual directly filing the document establishing or first registering the reporting company, and the person primarily responsible for directing or controlling the filing process. Reporting company applicants is only mandatory if the company was established or registered on or after January 1, 2024.
What specific details does my company need to provide?
A reporting entity must furnish its legal name, any trade name or DBA, address, jurisdiction of formation or initial registration (depending on whether it's domestic or foreign), and Taxpayer Identification Number (TIN). For each beneficial owner and company applicant (if applicable), the company must provide their legal name, birthdate, address (typically a home address), and an identifying number from a driver’s license, passport, or other approved document, along with an image of the document containing the number.
When and how should my company submit its initial report?
Existing companies as of January 1, 2024, must file their initial BOI report by January 1, 2025. For companies created or registered in the U.S. between January 1, 2024, and January 1, 2025, there's a 90-day window from receiving actual or public notice of the effectiveness of their creation or registration. For those created or registered after January 1, 2025, the deadline is 30 calendar days from receiving actual or public notice of their creation or registration effectiveness.
What procedures apply to changes or inaccuracies in reported information?
Your company has 30 days to report any modifications to previously submitted information. The countdown for updates begins upon the occurrence of the relevant change, while for corrections, it initiates upon awareness or reason to know of an inaccuracy in a prior report.