03/30/2024
To all my Facebook friends, in particular those who have a businesses (especially us small LLC owners), figured you would be interested in some information that you might now be aware of...
In 2021, Congress passed the Corporate Transparency Act. As part of that Act, which is now law, effective January 1, 2024, businesses are required to register something called "Beneficial Ownership" with FINCEN. Businesses required to register are broken up into two categories:
1.) Domestic reporting companies are corporations, limited liability companies, and any other entities created by the filing of a document with a Secretary of State or any similar office in the United States.
2.) Foreign reporting companies are entities (including corporations and limited liability companies) formed under the law of a foreign country that have registered to do business in the United States by the filing of a document with a secretary of state or any similar office.
There are also 23 types of entities that are exempt from the reporting requirements, but you need to carefully review (probably with the assistance of your lawyer or CPA) the qualifying criteria before concluding that your company is exempt.
Failure to report as required can, in some instances, result in major fines. As of January 25, 2024, the fine for willful failure to report beneficial ownership information (BOI) to FinCEN is $591 per day, up to $10,000. This fine applies to incomplete or updated information, as well as false or fraudulent information.
That said, after you've consulted with your tax and legal professionals, there is some good news. If you are required to report, the actual registration process is extremely simple and can be done without the assistance of tax or legal professionals provided you ensure all the information is entered correctly, and you ensure you retain copies of the registration documents the FINCEN website will provide when you complete the process. Assuming you have all your information and identification ready for input, the whole process should only take about 10 minutes.
Here is the FINCEN website so you can go research the requirements as they apply to you:
https://www.fincen.gov/boi-faqs
Happy Easter!
FinCEN has prepared the following Frequently Asked Questions (FAQs) in response to inquiries received relating to the Beneficial Ownership Information Reporting Rule.
