*Scary but True*
Failure to report could result in possible civil and criminal penalties. See if you are required to report.
image courtesy of https://www.fincen.gov
This is a reminder that laws and regulations are continually being added and updated. One such important new federal reporting requirement has been added which affects those who file documents with the Secretary of State. It is the Beneficial Ownership Information (BOI) Reporting Rule, part of the Corporate Transparency Act. The purpose of the reporting requirement is to counter crimes such as money laundering and terrorism. The reporting requirement took effect on January 1, 2024. Reporting companies are required to file an initial online report. This report will need to be updated if there is a change in the information provided. Each report is filed online on the Financial Crimes Enforcement Network (FinCEN) website and there is no fee to file.
Reporting companies that were created prior to January 1, 2024, have until January 1, 2025, to file. Reporting companies created between January 1, 2024, and December 31, 2024, will have 90 days from their creation to file. After January 1, 2025, reporting companies will have 30 days after creation to file.
What Is A Reporting Company?
A reporting company is an entity that was created by the filing of a document with a Secretary of State or similar office. There are some entities that are exempt such as banks, governmental authorities, tax exempt entities, and accounting firms.
What Information Is Needed and Who Does It Apply To?
The BOI report is required to include for each beneficial owner or applicant the person’s full name, date of birth, current address (residential or business), and a unique identifying number from a document such as a passport, driver’s license, or a state or local government identification document. A beneficial owner is someone who has substantial control over the company, or they own or control no less than 25% of the ownership interests of the company. A trustee of a trust may be considered to exercise substantial control over a reporting company and thus would be considered a beneficial owner. An applicant is someone who directly files with the Secretary of State of their respective state or with a similar office, the creation or registration documents of the company or they may also be someone who is primarily responsible for the filing of such documents by controlling or directing the filing. An applicant is also someone who qualifies as a foreign entity to do business in the US.
What You Should Do?
It is important to accurately assess several factors in filing the BOI report. Some of these factors include whether your company is a reporting company, who is a beneficial owner of your company, and whether your applicant information should be reported or if an exemption applies. This is important because there are civil and criminal penalties for filing false or fraudulent information. If incorrect information is corrected within 90 days of the initial filing a safe harbor exception applies. Please take note of this new reporting requirement to make sure you meet the deadline and provide accurate information in doing so.
For More Information and guidance, please contact FinCEN directly at:
Website: https://www.fincen.gov/boi
Phone Number: 1-800-767-2825
Email: [email protected]
Reporting companies that were created prior to January 1, 2024, have until January 1, 2025, to file. Reporting companies created between January 1, 2024, and December 31, 2024, will have 90 days from their creation to file. After January 1, 2025, reporting companies will have 30 days after creation to file.
What Is A Reporting Company?
A reporting company is an entity that was created by the filing of a document with a Secretary of State or similar office. There are some entities that are exempt such as banks, governmental authorities, tax exempt entities, and accounting firms.
What Information Is Needed and Who Does It Apply To?
The BOI report is required to include for each beneficial owner or applicant the person’s full name, date of birth, current address (residential or business), and a unique identifying number from a document such as a passport, driver’s license, or a state or local government identification document. A beneficial owner is someone who has substantial control over the company, or they own or control no less than 25% of the ownership interests of the company. A trustee of a trust may be considered to exercise substantial control over a reporting company and thus would be considered a beneficial owner. An applicant is someone who directly files with the Secretary of State of their respective state or with a similar office, the creation or registration documents of the company or they may also be someone who is primarily responsible for the filing of such documents by controlling or directing the filing. An applicant is also someone who qualifies as a foreign entity to do business in the US.
What You Should Do?
It is important to accurately assess several factors in filing the BOI report. Some of these factors include whether your company is a reporting company, who is a beneficial owner of your company, and whether your applicant information should be reported or if an exemption applies. This is important because there are civil and criminal penalties for filing false or fraudulent information. If incorrect information is corrected within 90 days of the initial filing a safe harbor exception applies. Please take note of this new reporting requirement to make sure you meet the deadline and provide accurate information in doing so.
For More Information and guidance, please contact FinCEN directly at:
Website: https://www.fincen.gov/boi
Phone Number: 1-800-767-2825
Email: [email protected]
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