In recent years, there has been a significant push for increased transparency and accountability in corporate structures. One of the notable developments in this regard is the introduction of Beneficial Ownership Information (BOI) reporting requirements.
Beneficial ownership information refers to identifying information about the individuals who directly or indirectly own or control a company. The newly enacted requirement that requires entities to file a BOI is aimed at ensuring corporate transparency and accountability. There is no fee for submitting your beneficial ownership information report. All BOIs must be submitted to the Financial Crimes Enforcement Network (FinCEN) of the US Department of the Treasury.
Both domestic and foreign businesses registered to do business in the United States will be required to report Beneficial Ownership Information to FinCEN. LLCs and C Corporations (including those with S Corporation status) are required to file a BOI. Similarly, other entities such as limited partnerships, limited liability partnerships, and businesses trusts may also have to file a BOI.
However, FinCEN has provided a number of exemptions for the beneficial ownership reporting requirement. For example, sole proprietorships and general partnerships are not required to report business ownership information because they are not registered legal entities. Additionally, FinCEN has listed 23 types of entities that are excused from the beneficial ownership reporting rule. These can be found on the FinCEN BOI website. It is important to review the list of exempt entities to see if your entity is excused or must file a BOI.
A beneficial owner is an individual who either directly or indirectly: (1) exercises substantial control over a reporting company, or (2) owns or controls at least 25 percent of a reporting company’s ownership interests. Trusts, corporations, or other legal entities are not considered to be beneficial owners as they are not individuals (i.e., natural persons).
An individual may exercise substantial control over a reporting company in four different ways:
Important decisions include decisions about reporting company’s business, finances, and structure. An individual that directs, determines, or has substantial influence over these important decisions exercises substantial control over a reporting company.
Beneficial Ownership Information reports are to be filed with FinCEN through its electronic filing system available via FinCEN’s BOI E-Filing Website: https://boiefiling.fincen.gov. Entities may submit their BOI to FinCEN on their own or may consult with a professional service provider such as a lawyer or accountant to assist them through the process.
A reporting company created or registered to do business before January 1, 2024, will have until January 1, 2025, to file its initial BOI. A reporting company created or registered in 2024 will have 90 calendar days to file after receiving actual or public notice that its creation or registration is effective. A reporting company created or registered on or after January 1, 2025, will have 30 calendar days to file after receiving actual or public notice that its creation or registration is effective.
You only need file a BOI once unless there are future changes to the information previously filed in your business’s BOI. You must update the BOI report upon any change to previously reported information about the reporting company itself or its beneficial owners. Updates should be reported within 30 calendar days after a change occurs. FinCEN has provided a number of resources that inform and guide entities through this process. These resources can be found at the links below:
https://www.fincen.gov/boi-faqs
https://www.fincen.gov/boi/Reference-materials
https://www.fincen.gov/boi/small-business-resources
https://www.fincen.gov/boi/newsroom
Wilson Whitaker Rynell Law Firm excels in the precise management and filing of Beneficial Ownership Information, ensuring strict adherence to legal standards. Our expert attorneys, with specialized knowledge in corporate law and business law, are dedicated to accurate and secure reporting for your company. We offer customized services to businesses of varying sizes, expertly navigating the complexities of ownership disclosure requirements. Choose Wilson Whitaker Rynell for unparalleled professionalism and thorough guidance in managing your Beneficial Ownership filings. Our commitment is to protect your business interests under the law.
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