New REQUIRED Business Filing: Beneficial Ownership Information (BOI)

In an effort to enhance corporate transparency and combat illicit financial activities, the Financial Crimes Enforcement Network (FinCEN) has implemented new Beneficial Ownership Information (BOI) reporting requirements under the Corporate Transparency Act (CTA). These regulations, which took effect on January 1, 2024, mandate that many entities in the United States report information about their beneficial owners—the individuals who ultimately own or control the company.

Who Must File

The BOI reporting requirements apply to both domestic and foreign reporting companies:

• Domestic Reporting Companies: Corporations, limited liability companies (LLCs), and other entities created by filing a document with a secretary of state or similar office under the law of a U.S. state or Indian Tribe.

• Foreign Reporting Companies: Corporations, LLCs, or other entities formed under the law of a foreign country that are registered to do business in the United States by filing a document with a secretary of state or similar office under the law of a state or Indian Tribe.

Certain entities are exempt from these reporting requirements, including:

• Securities reporting issuers

• Governmental authorities

• Banks

• Credit unions

• Depository institution holding companies

• Money services businesses

• Broker-dealers

• Investment companies and advisers

• Insurance companies

• State-licensed insurance producers

• Public accounting firms

• Public utilities

• Subsidiaries of certain exempt entities

• Inactive entities

A comprehensive list of exemptions is available on FinCEN’s website.

Information Required

Reporting companies must provide the following information about each beneficial owner and company applicant:

• Full legal name

• Date of birth

• Current residential or business street address

• Unique identifying number from an acceptable identification document (e.g., passport, driver’s license)

Additionally, an image of the identification document must be submitted.

How to File Online

To comply with the BOI reporting requirements, entities must file their reports and can do so electronically for FREE through FinCEN’s BOI E-Filing System. The steps are as follows:

1. Access the BOI E-Filing System: Visit the BOI E-Filing System at https://boiefiling.fincen.gov/.

2. Prepare the Required Information: Gather all necessary information for each beneficial owner and company applicant, including identification documents.

3. Initiate the Filing Process: On the BOI E-Filing System homepage, select the “File BOIR” option, then click “Prepare & Submit BOIR” under the “File Online BOIR” section.

4. Agree to the Terms: Review the warning language presented and click the “I Agree” button to proceed.

5. Complete the Report: Navigate through the filing tabs—Filing Information, Reporting Company, Company Applicant(s), Beneficial Owner(s), and Submit—entering the required information in each section.

6. Submit the Report: After completing all sections, review the information for accuracy and submit the report.

Detailed step-by-step instructions and resources are available on the BOI E-Filing System’s help page.

Current Enforcement Status

As of February 19, 2025, FinCEN announced that it will not issue any fines or penalties or take any other enforcement actions against companies based on any failure to file or update BOI reports by the current deadlines. No fines or penalties will be issued, and no enforcement actions will be taken, until a forthcoming interim final rule becomes effective and the new relevant due dates in the interim final rule have passed.

Filing is considered mandatory and penalties and enforcement actions may go into effect eventually.

Conclusion

The implementation of BOI reporting requirements are said to be created in order to enhance corporate transparency and combat financial crimes. My personal belief is that the excluded entities represent the areas where transparency is needed most, and that requiring small business owners to divulge MORE information to the federal government is an unnecessary government overreach and data grab.

However despite my personal feelings about this new requirement I want to make sure that small business owners like myself are informed about their obligations and utilize FinCEN’s resources to ensure compliance. For the most current information and updates, visit FinCEN’s Beneficial Ownership Information Reporting page.