The feds want to know who benefits from owning your business and you must tell them this year. The Federal Crimes Enforcement Network (FinCEN), a part of the U.S. Treasury, has opened its online registration reporting portal and companies can now submit Beneficial Ownership Information (BOI).
The new BOI reporting requirement was created to increase transparency in business activities, prevent money laundering, and improve the ability of FinCEN and other agencies to protect U.S. national security and the U.S. financial system from illicit activities. Companies registered as a business with the Secretary of State, in a U.S. state, territory, or Indian tribe, must comply by reporting names, dates of birth, addresses and identifying numbers from a non-expired ID for each of their beneficial owners.
Not complying with the new Beneficial Ownership Information Reporting Requirement can result in civil and criminal penalties of up to $10,000 and two years in jail. Some noteworthy deadlines:
- If the business is formed before January 1, 2024, you have until January 1, 2025, to file this report with FinCEN.
- If the entity formed on January 1, 2024, or later, you have 90 days from the time your business is registered to file.
- As of January 1, 2025, the period to make an initial filing for a newly created entity will be reduced to 30 days after registration.
The information needs to be filed electronically through a secure filing system available via FinCen’s website at https://www.fincen.gov/boi.
If the information is not filed on time or false information is filed, fines of up to $500 per day will be incurred for ongoing violations, in addition to criminal consequences which may include imprisonment for up to two years and/or a fine of up to $10,000 .
But wait! Not all companies must file! To determine whether your company is exempt from filing, a list of exemptions can be found here: List of 23 Exemptions.
Contact your RKW business attorney with questions.
