Beneficial Ownership Information (BOI) Reporting: Does It Apply To My Business?

Beneficial Ownership Information (BOI) Reporting: Does It Apply To My Business?

There has been much buzz about understanding Beneficial Ownership Information (BOI) reporting. The most-asked questions from small business owners are, “What is BOI?” And… “How do I know if this applies to me?”

In 2021, Congress passed the Corporate Transparency Act on a bipartisan basis. This law, which went into effect on January 1, 2024, created a new Beneficial Ownership Information (BOI) reporting requirement as part of the U.S. Government’s efforts to make it harder for bad actors to hide or benefit from their ill-gotten gains through shell companies or other opaque ownership structures.

In a recent announcement, Brian Nelson, the U.S. Treasury’s Secretary for Terrorism and Financial Intelligence, reports that criminals have laundered enormous sums of money into the United States with anonymity for years. Anonymous companies destabilize our local economies, harming fair business competition on Main Street across America. They compromise our national security, and they enable crimes like drug trafficking and terrorism, says Nelson. Since the reporting requirement became effective on January 1, 2024, many companies in the United States have complied with reporting Beneficial Ownership Information (BOI) to the U.S. government about who ultimately owns or controls their businesses. Many still have not.

Does this new reporting requirement apply to my business? The short answer is, “yes”, unless you are a type of business that is exempt from reporting such as banks, credit unions, insurance companies, tax-exempt entities, etc. In fact, there are 23 types of businesses that are exempt from this mandatory reporting requirement. For a full list of exempt businesses, click here. If you are not on the exempt list, get registered. It’s a quick and easy 1-time registration process for your business to eliminate you from being investigated as an “unknown” or potentially added to a list of entities suspected of being “bad actors”.

Compliance Deadlines: New businesses formed after January 1, 2024, were asked to comply with the new reporting rule within 90 days of the business formation, and businesses formed before January 2024 have until January 1, 2025, to complete the task. Again, you only have to complete this process one time, unless you need to make changes to your information.

To file your BOI report for your business, or to find answers to frequently asked questions, visit https://www.fincen.gov/boi for more information, and additional guidance materials.

This information does not and is not intended to, constitute legal advice. All information, content, and guidance provided is for general informational purposes only, does not supplement or modify any obligations imposed by statute or regulation, and does not supersede more recent guidance issued by FinCEN or the office of the U.S. Treasury.