Background: In 2021, Congress enacted the Corporate Transparency Act. As part of that law, starting January 1. 2024 many companies must now report Beneficial Ownership Information, or BOI. This information must be electronically reported to the Financial Crimes Enforcement Network (FinCEN) at https://www.fincen.gov/boi.
Frequently Asked Questions (FAQs)
- Who must file? For domestic companies, any business created in the United States by filing a document with a secretary of state or any similar office. This includes single-member LLCs, even if filing Schedule C, multi-member LLCs, S corporations, and C Corporations.
- Is anyone exempt? Yes, a full list can be found on page 11 of this guide from FinCEN.
- What is the filing deadline?
- If your company was formed by filing with a secretary of state before January 1, 2024, you have until January 1, 2025 to file your BOI report.
- If you create or register a company after January 1, 2024, you must report BOI within 90 calendar days after receiving actual or public notice that your company’s creation or registration is effective, whichever is earlier.
- If you create or register a company after January 1, 2025, the deadline shrinks to 30 days.
- Subsequent name, ownership, and address changes must be reported within 30 days of occurrence.
- What if I’m late? The penalties for non-compliance are $500 per day and up to 2 years in prison. There are very few exceptions for small businesses, and newly incorporated LLCs and corporations have the most significant exposure for non-filing because their deadlines are much shorter. Make sure you file a report for any new entities you establish.
- Where can I find more information? FinCEN has prepared a short information brochure and a news release.
Preliminary Required Steps
- Every owner of the business must have a FinCEN ID before the BOI report can be submitted. If you or another owner(s) need one, here’s where you get one: FinCEN ID Application for Individuals.
- On that page, one of the first things you’ll see is a button labeled “Sign in or Create an Account with Login.gov.” That’s because new FinCEN ID applicants must first create a Login.gov account.
- Unfortunately it’s kind of pointless to have someone else to set up a Login.gov account or apply for a FinCEN ID for you. It would take longer to give them the few bits of information required than it will for you to do it yourself. The good news is that setting up either one is relatively simple.
- On the FinCEN ID application page, if you don’t already have a Login.gov account, click “Sign in or Create an Account with Login.gov”
- During the Login.gov setup process, you’ll be asked for your email address and to setup a password.
- You’ll also be asked to select a secondary verification method. We recommend text message, as it’s the easiest. The only catch to that is, you can’t use any VOIP (voice over internet protocol) numbers, such as Google Voice, Ring Central, or Dialpad. You must use a phone number issued by a landline or cell phone company.
- You’ll also be encouraged to setup a third verification method, but it’s not required at this time.
- You’re done.
- After you have created a Login.gov account, if you aren’t taken back to the FinCEN ID application for individuals, here’s the link again. Please note it’ll be easier if you’re still signed into Login.gov and open the FinCEN ID application in a new browser tab. Otherwise you’ll have to log in to Login.gov again.
The FinCEN ID application is fairly easy to complete, as it doesn’t ask for that much information.
- Enter your full name, date of birth, and current address.
- You’ll need to upload a scan or photo of an identifying document with a unique identifying number. Documents accepted include:
- State-issued driver’s license
- U.S. Passport
- Foreign Passport
- ID document issued by a state or local government, or an Indian tribe, for the purpose of identifying you.
- The last question asks you to certify the information provided is correct.
- After you complete the application, do not leave that page. Your FinCEN ID will be displayed on it within 2-15 minutes. Write it down, record it electronically, and securely store it where you can find it.
FINALLY – Complete the BOI Report
Now that all the business owners have a FinCEN ID, you’re ready to complete the BOI Report. There are two ways to do this: PDF upload or the online system. The PDF upload is difficult and glitchy, so we recommend you use the online system, which does not require a login. Your company will also need a FinCEN ID, but if it doesn’t have one already, you can request one when you’re filling out the report.
The BOI online reporting form itself consists of about 40 questions; none of them require a Ph.D. in tax law to complete. But if you’d rather not do it, we’re happy to do that for you. Our fee is $100, and you’ll receive a copy of the report transcript and the submission confirmation when we finish. To get started, signup for our free and secure client portal, TaxDome. Be sure to choose the BOI option on the signup page. You’ll use TaxDome to complete our BOI organizer and pay your fee. If you have any questions, please use the “Book a Call” button above to schedule a Zoom call.