FinCEN Beneficial Ownership Reporting
With less than two months remaining in 2024, it is important that all business owners and leaders are aware of and in compliance with a 2024 federal regulatory update that impacts an estimated 97% of small and medium sized businesses. On January 1, 2024, the Corporate Transparency Act (CTA) was officially enacted into law as part of the National Defense Act. The CTA mandates the disclosure of Beneficial Ownership Information(BOI) to the Financial Crimes Enforcement Network (FinCEN). This new reporting requirement aims to combat money laundering, terrorism financing and other illicit activities, by requiring businesses to report both their ownership and disclose who exert substantial control over their organization.
Which companies must file
In general, most corporations and LLCs registered in the US are required to file unless they fall under a narrow category of exemptions. The exempt filers include publicly traded companies, nonprofits, registered investment entities and managers and other highly regulated entities such as banks and insurers.
BOI reporting deadlines & Penalties
A company formed before 2024: BOI report due by January 1, 2025.
A company formed during 2024: BOI report due within 90 days of formation.
A company formed after January 1, 2025: BOI report is due within 30 days of formation.
Penalties : Non-compliance with this new law attract hefty fines of up to $591 per day, with a maximum total of $10,000 per entity
How to file
The Treasury Department of the Government has created a direct filing portal for BOI reporting Link to Portal . To assist with filing, the government has provided a 21-page instruction manual, accompanied by a 50-page small entity compliance guide.
Recent filing extensions granted by the Government
On 10/29/2024, FinCEN announced that certain victims of Hurricanes Beryl, Debby, Francine, Helene and Milton will receive an additional six months to submit beneficial ownership information (BOI) reports. See each of the notices from FinCEN below:
Hurricane Beryl