Most Common Questions About theBeneficial Ownership Information Report

The beneficial ownership information (BOI) report is a key document for businesses that helps regulatory agencies, such as the U.S. Treasury’s Financial Crimes Enforcement Network (FinCEN), prevent illegal activities like money laundering and fraud. If you’re unsure about what this report is or whether your business needs to file one, here are answers to some of the most common questions for those required to report beneficial ownership.

1. What is a beneficial owner?

A beneficial owner is any person who either directly or indirectly exercises substantial control over a company or owns at least 25% of the company’s ownership interests. This control can be through equity ownership, voting rights, or by exercising significant influence over important company decisions.

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2. What is the beneficial ownership information report?

The BOI report is a document required by FinCEN under the Corporate Transparency Act (CTA) that collects information about the beneficial owners of companies. Beneficial owners are individuals who directly or indirectly own or control a significant percentage of a company. This report is intended to create transparency around company ownership and ensure that businesses are complying with anti-money laundering (AML) and anti-corruption regulations.

3. Who needs to file a BOI report?

Almost all legal entities formed in the U.S. must file a BOI report. This includes entities created by filing documents with state, tribal, or federal authorities. The primary entities required to file include:

Corporations
Limited Liability Companies (LLCs)
Other similar entities that are formed through formal registration processes

However, there are 23 exemptions. For example, large operating companies with more than 20 full-time employees, more than $5 million in annual revenue, and a physical presence in the U.S. are exempt, as well as certain regulated entities like banks and insurance companies. Many tax-exempt nonprofits under Section 501(c) of the Internal Revenue Code are also exempt.

If your business does not qualify for an exemption, you’ll need to file a BOI report.

4. What information is required in the BOI report?

The BOI report requires the following information for each beneficial owner:

Full legal name
Date of birth
Current residential address or business address (for those filing on behalf of an entity)
A unique identifier such as a Social Security Number (SSN), Passport number, or Driver’s License number
A copy of the identifying document (such as a passport or driver’s license)

Additionally, the business will need to provide its own identifying information, such as the business’s name, address, and Employer Identification Number (EIN).

5. When is the BOI report due?

For companies that were already in existence before January 1, 2024, the reporting deadline is January 1, 2025. For companies formed between January 1, 2024 and December 31, 2024, the reporting deadline is within 90 days of public/official formation. For companies formed on January 1, 2025 and onward, the BOI report must be filed within 30 days of registration.

After the initial filing, companies must file updates within 30 days of any changes to the beneficial ownership information. This includes updates such as changes in ownership or changes to a beneficial owner’s personal information, like their legal name or address.

6. What are the penalties for not filing a BOI report?

Failing to file a BOI report or providing false information can result in significant penalties. Businesses could face civil penalties of up to $500 for each day the violation continues. Additionally, criminal penalties may include fines of up to $10,000 and/or imprisonment for up to two years. It’s important to ensure that all information provided is accurate and submitted on time.

7. How can I ensure compliance with BOI report requirements?

To ensure compliance, businesses should:

Regularly review and update beneficial ownership information to ensure it’s accurate.
Keep thorough records of ownership changes and other relevant details.
Establish clear internal processes for gathering and verifying beneficial ownership data.

If you’re unsure whether your business needs to file a BOI report or how to go about it, consulting with a legal or financial advisor can help ensure you meet all requirements.

8. Can I submit the BOI report electronically?

Yes, FinCEN allows for the electronic submission of BOI reports through its online portal, but it’s crucial to double-check all information before submitting to avoid any errors that could lead to penalties. You can also file your BOI report with FastFilings, which offers a quick and easy online system to ensure your report is accurate and filed on time.

9. How often do I need to update the BOI report?

Once filed, the BOI report needs to be updated within 30 days of any change in beneficial ownership or if any of the information provided becomes outdated. For instance, if a new owner acquires a significant share of the company, or if a beneficial owner’s address or identification document changes, the report must be amended accordingly.

10. What should I do if I discover an error in my filed BOI report?

If you realize that you made an error in your BOI report, it’s essential to correct it as soon as possible. FinCEN allows businesses to file an amended report within 30 days of discovering the mistake. Correcting any errors promptly can help you avoid penalties and ensure your company remains compliant.

File Your BOI Report With FastFilings

Ensuring compliance with the beneficial ownership information report can feel overwhelming, but it doesn’t have to be. FastFilings offers a quick and easy online system that simplifies the filing process. With our platform, you can file your BOI report accurately and on time, avoiding penalties and ensuring your business stays compliant. Get started with FastFilings today to streamline your filing process!

File your Beneficial Ownership Information Report!

Need help filing your BOI Report?

Get Started!