11/26/2024
Important Information – BOI Reporting – Due January 1, 2025 – Please Read
In accordance with the Corporate Transparency Act passed in 2021, there is a new beneficial ownership information (BOI) reporting requirement as part of the US government’s efforts to crack down on financial crimes. Beneficial ownership information refers to identifying information about the individuals who directly or indirectly own or control a company. The BOI reporting will take place through the Financial Crimes Enforcement Network (FinCEN). Companies that are required to complete the BOI reporting are corporations, limited liability companies (LLC), and any other entities created by the filing of a document with a secretary of state or any similar office in the United States. There are certain types of businesses that are exempt from this filing requirement. For all reporting companies that were formed prior to January 1, 2024, the deadline for filing the BOI report is January 1, 2025. Companies created or registered in 2024 have 90 calendar days to file after receiving notice that their company’s creation is effective. The penalty for willfully failing to comply with the BOI reporting requirement is $500 per day and possible criminal penalties of up to $10,000 and/or up to 2 years imprisonment. You can click on the first link below to visit the FinCEN Beneficial Ownership Information page. Here you can find an abundance of helpful information such as the list of exempt businesses, frequently asked questions, filing directions, and even a short video tutorial of how to complete the BOI report online.
https://fincen.gov/boi
You will need to gather the following information before completing the BOI report:
-Legal name of business
-DBA or trade name if applicable
-EIN or SSN
-Formation country and state
-Business address
-Company applicant information – Only reporting companies that were formed on January 1, 2024 or later are required to report company applicants. For reporting companies created or registered before January 1, 2024, mark the check box on item 16 of the report. This indicates that the business is an “Existing reporting company” and will not need to report company applicants. Once you mark the check box on number 16, you can click “Next” to skip past Part II. Company Applicant Information.
-Beneficial Owner Information – You are required to report the information for ALL beneficial owners of the company. You can add as many owners as needed by clicking the “Add Beneficial Owner” box located at the top of Part III
-FinCEN ID – This field is not required, and most beneficial owners will NOT have this ID number and can skip this field.
-Name
-Date of Birth
-Address
-Identifying Document – Driver’s License, State Issued ID, Passport – You will have to report the identifying document number, the issuing country, and the issuing state. In addition, you will have to upload an image of the Identifying document. You will have to scan the document or take a picture of the document and upload that document image to the website.
-Email address
Once you are ready to complete the BOI report, click on the link below.
https://boiefiling.fincen.gov/boir/html
Once you have completed all required fields, be sure to check the “I Agree” certification box certifying that the information is true, correct, and complete. After submitting the report, be sure to print or save a copy of the submission for your records.
A few things to note:
-The BOI reporting can involve navigating complex legal and compliance requirements. As accountants, we are not licensed to provide legal services. As such, it has been recommended that we do not engage in the practice of completing the BOI reporting for our clients as it may be considered by some states as engaging in the practice of law which we are not authorized to do. With that being said, if you have questions about this reporting requirement, we will try to answer those to the best of our ability.
-FinCEN reports that they have learned of fraudulent attempts to solicit information from individuals and entities who may be subject to reporting requirements under the Corporate Transparency Act. There are fraudulent correspondences being sent out requesting that you pay a fee to have someone report your BOI for you. We have personally been made aware of a mailed correspondence requesting a fee of $119 to file the BOI report and a text correspondence requesting that you pay a fee of $199 to file the BOI report. These correspondences are scams. Do NOT respond to them and do NOT send your information or money to them. There is NO FEE for filing the BOI report with FinCEN and any correspondence asking you to pay a fee is fraudulent.
-Probably the hardest part of the BOI reporting for some will be uploading the pictures of the identifying document (License, ID, Passport) for the beneficial owners. If you do not have a scanner, you can scan the document or take a picture of the document with your cell phone. You can then share that picture to your email address. Then, open up your email on your computer and download the picture. You should then be able to upload the picture from your computer to the website. Another option may be to complete the BOI report on your cell phone instead of the computer. I’m not sure how hard it would be to navigate the website on the cell phone.
-Please feel free to share this information with anyone you know of that may be affected by this reporting requirement. There are many business owners who are not aware of this requirement and, so far, we have not seen any communication coming out from the NC Secretary of State letting owners know that this needs to be taken care of.
I know this is a lot of information, but I hope it is helpful as you navigate this required reporting process.
