In a quest to combat money laundering, tax evasion, and other financial crimes, the corporate transparency act (CTA) requires many companies to file Beneficial Ownership Information (BOI) with FinCen. Anyone who, directly or indirectly, owns 25% or more of a company or has significant control over a company, must file BOI.
Who Must File BOI?
BOI reporting applies to Corporations, Limited Liabilities Companies (LLCs), and other entities that are separate from their owners.
Who Doesn’t Need to File BIO?
BOI reporting does not apply to Sole Proprietorships, General Partnerships, publicly traded companies, nonprofits, banks, credit union and government entities.
Information required to file for a business and its owners:
- Business EIN number
- Full Name
- Date of birth
- Current Address
- Driver’s License or Passport Identification number
- A copy of your ID
Filing Deadline
If your company was formed prior to January 1, 2024, you have until January 2025 to file your initial report with the Financial Crimes Enforcement Network (FinCEN). Companies formed in 2024, have 90 days to file their initial reports and companies formed after January 1, 2025, or later have 30 days to file their initial reports.
Changes in beneficial ownership must be report within 30 days. This includes sell or transfer of ownership interest, a new party gains substantial control over the business, or if an owner changes his/her legal name.
Penalties for Non-compliance
The penalty for failing to report or update information in a timely manner can cost up to $500 per day for each day of the violation. Willfully failing to comply or providing false information can result in jail time and a fine up to $ 10, 000.
Ensuring you comply with beneficial ownership information requirements is crucial for your business. Make sure you file timely, your information is accurate to avoid penalties. Combatting financial crime should be a priority for everyone.