Beneficial Ownership Information (BOI) Report

There is a new information report required for businesses called the Beneficial Ownership Information (BOI) Report. This post contains general information applicable to small business owners to notify them and help them understand this new reporting requirement. Filing the report online on the US Treasury’s website is free, easy, and straightforward (it should take less than 10 minutes to complete), but if you require any assistance, please contact me.

Why do businesses need to file this?

To comply with federal law and avoid significant penalties, businesses are required to file this report with the Financial Crimes Enforcement Network (FinCEN), a bureau of the US Treasury. According to the FinCEN’s FAQ on the BOI Report, the reports will be used to “make it harder for bad actors to hide or benefit from their ill-gotten gains through shell companies or other opaque ownership structures.”

What is Reported?

The business’ name, address, state of formation, and federal tax ID number.
Each beneficial owner’s name, date of birth, address, driver’s license or other ID number, and a photo of the ID. This applies to anyone with 25% or greater ownership or substantial control over the business.

Reporting Frequency:

Beneficial ownership information reporting is not an annual requirement. Unless a company needs to update or correct information, a report only needs to be submitted once.

Note that a change in beneficial ownership, or any relevant beneficial ownership information, such as a change to a reporting business’ address or an owner’s address requires an updated report. Similarly, if the beneficial owner’s driver’s license or other ID number changes, it requires updating the report.

Who Has to Report?

Corporations,
Limited Liability Companies, and
Other entities created by filing a document with a secretary of state,

Unless an exception applies…

Who is Exempt From Reporting?

Sole proprietorships (note that LLCs taxed as sole proprietors are required to file the report).
A business that meets an exemption on PDF page 11 of the Small Entity Compliance Guide. The next 10 pages of the linked guide provide clarifying details on who qualifies for the exemption.

How to Report:

File for free online at: https://boiefiling.fincen.gov/

It’s easy and straightforward to file. As indicated above, it requests basic information about the business and beneficial owners and should take less than 10 minutes.

Due Dates:

If your company was created or registered prior to January 1, 2024, you will have until January 1, 2025 to file a BOI report.

If your company is created or registered in 2024, you must file a BOI report within 90 calendar days after receiving actual or public notice that your company’s creation or registration is effective, whichever is earlier.

If your company is created or registered on or after January 1, 2025, you must file a BOI report within 30 calendar days after receiving actual or public notice that its creation or registration is effective.

Any updates or corrections to beneficial ownership information that you previously filed with FinCEN must be submitted within 30 days.

Additional Resources: