Starting in 2024, many businesses will need to file a Beneficial Ownership Information (BOI) report as part of new federal transparency rules. If your business is registered with the Secretary of State, you will need to file—even if you are a sole proprietorship or disregarded entity that doesn’t file a tax return. If you have an LLC, it will require a BOI Report. Businesses formed before January 1, 2024, must file by January 1, 2025, while those formed on or after January 1, 2024, must file within 30 days of formation. Updates, such as changes in ownership, name, or address, must also be reported within 30 days, though no annual filing is required.
The BOI report requires businesses to disclose specific details about both the company and its beneficial owners. Here’s what is included:
Information About the Reporting Company
- Legal Name
- Trade Name/DBA (if applicable)
- Address
- Jurisdiction of Formation (e.g., state or country where the business is registered)
- Taxpayer Identification Number (TIN) (e.g., EIN or other tax ID)
Information About Each Beneficial Owner
For each individual identified as a beneficial owner, the report must include:
- Full Legal Name
- Date of Birth
- Residential Address (not a business address)
- Unique Identifying Number from one of the following:
- U.S. Passport
- State-issued driver’s license
- State-issued ID card
- Foreign passport (if not a U.S. citizen)
- Image of the Identification Document (e.g., a scanned copy or photo of the ID used for the unique identifying number)
Information About Company Applicants (For entities formed on or after January 1, 2024)
- Company applicants are individuals who file the formation documents with the state.
- Their information must be included and will mirror the details required for beneficial owners.
This reporting is mandated by the Corporate Transparency Act (CTA) and is filed with the Financial Crimes Enforcement Network (FinCEN). It’s aimed at combating illicit activities like money laundering and fraud.
Where to Start
Visit the official FinCEN website at https://www.fincen.gov. While the exact portal for BOI filing may not be live yet, the website will have detailed guidance and updates as the filing deadline approaches
How to File
- Access the Filing Portal: FinCEN will provide a secure, online filing portal specifically for BOI reports. This portal is expected to be user-friendly and accessible to business owners.
- Prepare Required Information: Before starting, gather the necessary details about your business, beneficial owners, and company applicants (if applicable). This includes names, addresses, birth dates, and ID documentation.
- Submit Electronically: All submissions must be done online; there’s no option for paper filing. FinCEN will not charge a fee for filing the report.
Key Takeaways
In summary, the BOI filing requirement under the Corporate Transparency Act is a crucial step toward enhancing transparency and combating financial crimes. Business owners should familiarize themselves with the requirements, gather the necessary information, and meet the filing deadlines to ensure compliance. Visit the FinCEN website for updates and resources to help with the process.