Businesses with less than 21 employees OR less than $5M in sales are required to perform beneficial ownership information reporting to the financial crimes enforcement network (FinCEN) in order to avoid criminal and civil penalties of $500/day
Due date of 1/1/2025 for businesses created prior to 2024
Am I Exempt? Pricing Partnering Learn More Demo for PartnersBeneficial Ownership Information (BOI) refers to data that identifies the true owners or beneficiaries behind a business entity. This information is crucial for promoting transparency in financial transactions, complying with regulations, and combating financial crimes like money laundering. It helps authorities trace and understand the ownership structure of businesses, ultimately contributing to a more secure and accountable business environment.
Many businesses, including corporations, limited liability companies (LLCs), and other similar entities, are required to complete FinCEN Reporting under the Corporate Transparency Act. This includes entities formed or registered to do business in the United States.
This new reporting requirement is part of the Corporate Transparency Act (CTA), a new federal mandate requiring many businesses to complete Beneficial Ownership Reporting to avoid criminal and civil penalties. The requirement helps ensure transparency by revealing the true owners behind a business, complying with regulations and preventing financial crimes like money laundering.
In the end, this makes life harder for criminals. FinCEN will then store Beneficial Ownership Information (BOI) reports in a centralized database and only share this information with authorized users for purposes specified by law.
Non-compliance with these reporting obligations can have serious consequences. Willful failure to report complete or updated beneficial ownership information may result in civil or criminal penalties. Civil penalties could accumulate at a rate of up to $500 for each day the violation persists, while criminal penalties might entail imprisonment for up to two years or fines of up to $10,000.
Additionally, executives of a company that neglects to submit required Beneficial Ownership Information (BOI) reports may face repercussions. Moreover, those who deliberately induce a company to avoid filing accurate BOI reports or provide incomplete/false information to FinCEN could encounter civil and criminal penalties. This underscores the critical significance of complying with FinCEN Reporting obligations.
For companies created prior to January 1, 2024, you have until January 1, 2025 to submit your Beneficial Ownership Information Reporting.
For companies after January 1, 2024, and before January 1, 2025, you have 90 calendar days to make your filing to FinCEN.
For companies created after January 1, 2025, you will have 30 calendar days from actual or public notice that the company’s creation or registration is effective to your make your filing.
Our company was founded in 2015 to address new compliance regulations required under the Affordable Care Act. Over the years the compliance burden of companies continued to grow, and our organization has evolved to meet the needs of our clients and partners. Over the years we have learned a thing or two while servicing 15,000+ compliance clients, as well how to integrate and support our partners in serving the needs of their third-party clients.
Learn more about us Leadership TeamIf a person has reason to believe that a report filed with FinCEN contains inaccurate information and voluntarily submits a report correcting the information within days of the deadline for the original report, then the Corporate Transparency Act creates a safe harbor from penalty.
However, should a person willfully fail to report complete or updated beneficial ownership information as required under the Reporting Rule, FinCEN will determine the appropriate enforcement response in consideration of its published enforcement factors.
Providing false or fraudulent beneficial ownership information could include providing false identifying information about an individual identified in a BOI report, such as by providing a copy of a fraudulent identifying document. Additionally, a person may be subject to civil or criminal penalties for willfully causing a company not to file a required BOI report or to report incomplete or false beneficial ownership information to FinCEN.
For example, an individual who qualifies as a beneficial owner or a company applicant might refuse to provide information, knowing that a company would not be able to provide complete beneficial ownership information to FinCEN without it.
