Reporting Requirements
Starting January 1, 2024, certain corporations, limited liability companies (LLCs), and other similar entities operating in the United States must comply with new regulations requiring them to report beneficial ownership information (BOI) to the Financial Crimes Enforcement Network (FinCEN), a division of the U.S. Department of the Treasury. These regulations are part of a broader initiative to increase transparency in business ownership and combat illicit financial activities.
Below, we’ll walk you through the essential aspects of BOI reporting, why it’s important, and what your company needs to do to stay compliant.
What is Beneficial Ownership Information (BOI)?
BOI refers to identifying information about the individuals who own or control a business, either directly or indirectly. This typically includes people who hold a significant ownership stake or influence business decisions.
Why Do Companies Have to Report BOI?
The Corporate Transparency Act (CTA), passed in 2021, requires businesses to disclose BOI to make it more difficult for bad actors to conceal their activities behind shell companies or other opaque structures. By mandating transparency, the U.S. government aims to prevent money laundering, fraud, terrorist financing, and other financial crimes.
What Information Needs to Be Reported?
Companies required to file BOI must submit four key details for each beneficial owner:
- Name
- Date of birth
- Address
- An identifying number from an official document (e.g., U.S. driver’s license, U.S. passport, or state-issued ID). An image of the document must also be provided. If these documents are unavailable, a non-expired foreign passport is accepted.
Additionally, companies must submit their own information, including the official company name, address, and details about the person who formed the company (if the business was created after January 1, 2024).
When Does My Company Need to File?
- Existing companies (formed before January 1, 2024):
Deadline to file: January 1, 2025 - New companies (formed in 2024):
Deadline: Within 90 days after receiving public notice of formation. - Companies formed on or after January 1, 2025:
Deadline: Within 30 days after receiving notice of formation.
Why is BOI Reporting Critical?
Accurate and accessible BOI data plays a significant role across several sectors:
- Financial Institutions: BOI helps banks and lenders meet regulatory due diligence requirements to detect suspicious activities.
- Government Agencies: BOI assists in issuing loans, grants, or government contracts and in ensuring compliance with export controls.
- Businesses: Companies rely on BOI to assess third-party risks, mitigate exposure, and comply with laws related to fraud, money laundering, and sanctions enforcement.
Without clear BOI, financial institutions, governments, and businesses face challenges in identifying risks, preventing abuse, and safeguarding their operations from bad actors using anonymous shell companies.
At Brief Financial, we understand the complexities of BOI reporting and offer expert support to ensure your company meets the regulatory requirements. Our team is equipped to handle the entire BOI filing process, giving you peace of mind and freeing up your time to focus on growing your business.
Need help with BOI reporting? We can assist you with submitting your report quickly and accurately.
📞 Contact us today to get started with our BOI filing service and ensure your compliance with FinCEN regulations!
