BOI REPORT EXPLAINED

Got a shiny new business? Fantastic! But, there’s a bit of paperwork to handle—namely, the BOI for LLC report, if you wish to avoid costly fines and being noncompliant with the law. Here’s your guide to keeping on top of those deadlines:

Think of the BOIR as your company's transparency badge! This report is essential for businesses to share key details with FinCEN, spotlighting who really runs the show. It covers two main groups:

1. Beneficial Owners: These are the movers and shakers with at least 25% ownership or significant control over the company.
2. Company Applicants: The folks responsible for filing the paperwork to create or register your company.

The BOIR isn't just a formality—it's a crucial tool for promoting transparency and compliance. By providing accurate information about your beneficial owners and company applicants, you're helping to prevent financial crimes like money laundering and ensuring your business meets regulatory standards.

With the BOIR, FinCEN can keep track of who has significant control over companies, reducing the risk of illicit activities and fostering a safer, more transparent financial system. So, think of it as doing your part to keep the business world clean and trustworthy!

These are businesses formed under U.S. laws, such as:

• Corporations
• Limited Liability Companies (LLCs)
• Limited Liability Partnerships
• Business Trusts
• Many Limited Partnerships

These are businesses formed under foreign laws but registered to do business in any U.S. state by filing with the secretary of state.

There are some exemptions, so it's always a good idea to check FinCEN's resources to see if your company needs to file. For more details and to determine your filing requirements, visit the FinCEN website.

• For businesses already up and running as of January 1, 2024:
  • You’ve got until January 1, 2025, to file your initial BOI report.
• For businesses created or registered between January 1, 2024, and January 1, 2025:
  • You need to file within 90 days of receiving your notice.
• For businesses created or registered after January 1, 2025:
  • You must file within 30 days of receiving your notice.

The BOI (Beneficial Ownership Information) report is a one-time filing.

Once you've submitted the initial report, you generally don't need to file it again unless there are changes to the information provided.

When to Update the BOI Report

You will need to file an updated report if:

• There are changes to the beneficial ownership information: This includes changes in owners, addresses, or identifying information.
• There are inaccuracies in the previously filed report: You must correct these within 30 days of discovering the error.

Neglecting to file your beneficial ownership information with FinCEN can have serious consequences. Here's what could happen:

1. Daily Fines: You could face civil penalties of up to $500 for each day the violation continues.
2. Criminal Charges: You might also be looking at criminal penalties, which could include imprisonment for up to two years and/or fines up to $10,000.
3. False Information: Providing false or fraudulent information? The same stiff penalties apply.

To submit your BOI report, you must provide a Federal Tax Identification Number. If you don’t yet have an Employer Identification Number (EIN), you can use your Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN) as an alternative.

If you don't have an SSN or ITIN and are awaiting your EIN from the IRS, you will need to wait until your EIN is issued to complete the BOI filing. Unfortunately, the BOI report cannot be submitted without one of these identification numbers.

When filing your BOI report, FinCEN requires specific identification. For foreign individuals, a valid passport is required, as the FinCEN website does not accept other forms of ID for non-US citizens. If you do not have a passport, it’s best to contact FinCEN directly to discuss your available options.

Beneficial owners must be at least 18 years old. If a minor qualifies as a beneficial owner, they should be represented by a parent or guardian.

Bottom line: Keep your company in the clear by ensuring your reports are accurate and on time! Services like Wolters Kluwer can help.

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