Do I need to file a BOI report for my business?
What is a BOI report?
According to the Financial Crimes Enforcement Network (FinCEN) of the U.S. Department of the Treasury, BOI (Beneficial Ownership Information) refers to any identifying information related to individuals who have direct or indirect control over a company. Therefore, a BOI report refers to a detailed information report that certain business owners are required to submit. The regulation does not differentiate by company size; both small and large companies that meet the criteria are equally responsible for complying with the reporting rules.
1
Is my company a 'reporting company'?
"Reporting company" refers to corporations, limited liability companies (LLCs), limited liability partnerships (LLPs), and similar entities. This includes any company formed by filing incorporation documents with the Secretary of State or a similar authority. Additionally, foreign companies established outside the U.S. but registered to do business in the U.S. by submitting documents to the Secretary of State or a similar authority are also considered "reportable companies."
If your company meets the above definition of a "reporting company" and does not qualify for any exemptions, it is likely required to submit a BOI report.
2
What companies are exempt from the reporting requirements?
Although BOI reporting rules have a wide scope, certain companies under strict federal regulation may be exempt from filing. Key business types that might qualify for exemptions include banks, credit unions, tax-exempt organizations, investment firms, and accounting firms. FinCEN outlines 23 categories of potential exemptions for reporting companies.
3
What information does my company need to report?
You need to provide basic information about the 'reporting company,' as well as personal information for each 'beneficial owner and company applicant.
4
Who are the 'beneficial owners' and 'company applicants' of my company?
A beneficial owner refers to an individual who owns or controls at least 25% of the company's shares or has substantial control over the company. A company applicant is the individual who directly files or is primarily responsible for filing the company's formation or registration documents.
5
When should my company submit the BOI report?
If your company existed before January 1, 2024, the first BOI report is due by January 1, 2025. If your company was established or registered between January 1 and December 31, 2024, submit the initial BOI report within 90 days of effective formation or registration notice. From 2025 onwards, you’ll have 30 days to file your initial report.
All BOI reports must be filed electronically through a secure system.
6
What are the consequences if I fail to submit the report on time?
Failure to submit the BOI report may result in a daily fine of $500, up to a maximum of $10,000, and could be punishable by up to two years in prison. Unauthorized disclosure of beneficial ownership information may incur a daily fine of $500, up to a maximum of $250,000, and could be punishable by up to five years in prison.
