The Beneficial Ownership Information Reporting Rule (the “Reporting Rule”) is part of the Corporate Transparency Act (“CTA”), established under the Anti-Money Laundering Act of 2020 (the “AMLA”), and requires certain business entities to report beneficial ownership information (“BOI”) to the Financial Crimes Enforcement Network (FinCEN). The CTA became effective as of January 1, 2024. The first filing deadline for existing “reporting companies” is January 1, 2025, and the penalties for not filing are fines of up to $500/day (adjusted annually for inflation). Accordingly, it is important to determine whether your business or entity is a reporting company and is required to file a BOI.

Below is a summary of how to determine whether it impacts you and your business and the steps you may need to take to comply. We are here to help with any questions you may have and will gladly assist you with your BOI filing requirements. As a starting point, you must determine whether your company is required to report its beneficial owners pursuant to the Reporting Rule. The following are steps to assist in determining whether you need to file a BOI pursuant to the Reporting Rule for your entity:

  1. The first question is whether your company is a “reporting company.” A reporting company is (a) a limited liability company (“LLC”) or corporation established under the laws of the United States (including laws of the States and/or Indian tribes), or (b) a business entity formed under the laws of a foreign country and registered to do business in any U.S. State or Tribal jurisdiction.
    1. If neither applies, you do not have to file as you are not a reporting company.

    2. If the answer is yes to either, you need to proceed below to number 2 to determine whether you are a reporting company.

  2. Next, you need to determine if your company is exempt from the reporting requirement. A full list of the 23 types of entities exempt from the reporting requirements is available at: https://www.fincen.gov/boi-faqs#C_2 . As a quick reference, exempt entities include banks, credit unions, financial advisors, broker dealers, insurance companies, governmental authorities, public utilities, accounting firms and tax-exempt entities. Please see the full list to determine whether your entity is exempt. Note that there are tests for each exemption to determine whether an exemption applies to your entity.

    1. If your entity is exempt, you are not a reporting company and you do not have to file a BOI.

    2. If your entity is not exempt, proceed below to number 3 to determine whether you are a reporting company.

  3. You need to determine whether you are exempt from reporting as a “large operating company.” If you employ over 20 full time employees in the United States, reported at least $5 million in gross receipts or sales on your prior year Federal income tax return or information return in the United States, and have a physical presence in the U.S., you likely qualify as a large operating company and are exempt from filing a BOI. Otherwise, you likely are a reporting company required to file a BOI and should proceed below to number 4 to determine the beneficial owners of your entity.

  4. Next, you need to determine who the “beneficial owner(s)” of your entity are as reporting companies are required to identify all beneficial owners as part of filing their BOI. The following are considered “beneficial owners” of reporting companies under the CTA (subject to certain limited exceptions):

    1. All individuals with substantial control, including the following:

      1. Senior officers (CEO, President, CFO, COO, GC).

      2. Important decision makers with regards to business, finance and structure.

      3. Individuals with authority to appoint or remove senior officers or a majority of the board of directors or similar body.

      4. Individuals with some other form of substantial control.

    2. All individuals (including trusts) with ownership interests or similar rights of 25% or greater, including equity, stock, or voting rights, capital or profit interests, convertible instruments, options, or other instruments or contracts that establish ownership rights of 25% or greater.

  5. BOI reporting deadlines for initial BOI reports by reporting companies are as follows: Reporting company entities formed after January 1, 2024, must make a report within 30 days of creation (if we helped you form an entity this year, we assisted you with filing the BOI as part of the formation process).

    Reporting company entities formed before January 1, 2024, must file a BOI report by JANUARY 1, 2025.

  6. Other important information:

    1. Some reporting companies have to report information on their “company applicants” as follows: Entities formed after January 1, 2024, must report company applicants as part of their BOI filing. For information on properly identifying the company applicant(s), see: https://www.fincen.gov/boi-faqs#E_1

    2. Entities formed before January 1, 2024, do not have to report company applicants.

    3. Certain reporting companies are required to re-file or amend their BOI filing, including as follows: If there are changes in information regarding your reporting company or the beneficial owners, an amended report is required to be filed within 30 days of the change occurring.

    4. If you file a report regarding your company that contains an error, you must file an amended report correcting the error within 30 days. There are no penalties for inaccurate reports if the inaccuracies are corrected within 90 days.

    5. For additional information, please see the following links:

      1. https://www.fincen.gov/news/news-releases/us-beneficial-ownership-information-registry-now-accepting-reports

      2. https://www.fincen.gov/boi

      3. https://fincenid.fincen.gov/landing.

Please reach out to us if we can be of any assistance in helping you comply with the BOI reporting requirements. Whether you file your BOI report yourself or have us file on your behalf, we recommend you obtain a FinCEN ID so you will not have to enter your information and provide identification with every filing. If you choose to have us file your BOI report on your behalf, we need each beneficial owner of each reporting company to obtain a FinCEN ID by following the instructions at https://fincenid.fincen.gov/ . The process takes less than 10 minutes and is free of charge.

If you have any questions, please contact us at This email address is being protected from spambots. You need JavaScript enabled to view it. or (317) 660-3400.