Connor Brown
July 1, 2024

FinCEN Beneficial Ownership Information Reporting

If you started a new business or own a company in 2024, you have likely heard about the new beneficial ownership information (“BOI”) reporting requirements under the Corporate Transparency Act (the “CTA”). The CTA mandates that reporting companies disclose certain information about the business entity and its beneficial owners to the Financial Crimes Enforcement Network (“FinCEN”). In January of 2021, the CTA was enacted into law as part of the National Defense Authorization Act for Fiscal Year 2021. The purpose of the CTA is to prevent financial crimes and terrorism involving United States corporations, limited liability companies (“LLCs”), and other business entities. The CTA went into effect on January 1, 2024, and imposes civil and criminal penalties for non-compliance.

           The CTA requires every reporting company to disclose certain information to FinCEN about the business entity and its beneficial owners. A reporting company includes corporations, LLCs, and any other entity created by filing a document with a secretary of state or similar office and that fail to qualify for an exemption under the CTA. Regarding the reporting company itself, the business entity must disclose:

-       The full legal name of the business entity, as well as any trade name;

-       The street address of its principal place of business in the United States; and

-       The Taxpayer Identification Number (TIN) or Employer Identification Number (EIN).

Additionally, a reporting company must disclose information about its beneficial owners and company applicants. Beneficial owners are individuals who, directly or indirectly, (1) own twenty-five percent (25%) or more of the reporting company and/or (2) exercise substantial control over the reporting company. The company applicant is (1) the individual who directly filed the document that created or first registered the reporting company and (2) the individual who was primarily responsible for directing or controlling the filing of the first registration document. For every beneficial owner and company applicant, the reporting company must report the following for each individual:

-       Full legal name;

-       Date of birth;

-       Residential address, or in the case of a company applicant who forms or registers an entity in the course of the company applicant’s business, the street address of the company applicant’s business; and

-       Unique identifying number and the issuing jurisdiction from an acceptable form of identification(“ID”), as well as an image of the ID.

All reporting companies formed prior to January 1, 2024, must file a beneficial ownership information report (“BOIR”) before January 1, 2025. If a reporting company was formed during 2024, the deadline to file is 90 days following the date of creation. For all reporting companies created after 2024, the deadline to file is 30 days following the date of creation. If a BOIR was incorrect when filed or there is a change with respect to the required information that was previously submitted to FinCEN regarding the reporting company or its beneficial owners, a corrected or updated report, respectively, must be filed within 30 days of the inaccuracy or change.

If you have any questions about BOI reporting requirements or your company needs assistance with filing a BOIR with FinCEN, please contact our office!