What is beneficial ownership information?
Beneficial ownership information refers to identifying information about the individuals who directly or indirectly own or control a company.
Why do companies have to report beneficial ownership information to the U.S. Department of the Treasury?
In 2021, Congress passed the Corporate Transparency Act on a bipartisan basis. This law creates a new beneficial ownership information reporting requirement as part of the U.S. government’s efforts to make it harder for bad actors to hide or benefit from their ill-gotten gains through shell companies or other opaque ownership structures.
What companies will be required to report beneficial ownership information to FinCEN?
Companies required to report are called reporting companies. There are two types of reporting companies:
- Domestic reporting companies are corporations, limited liability companies, and any other entities created by the filing of a document with a secretary of state or any similar office in the United States.
- Foreign reporting companies are entities (including corporations and limited liability companies) formed under the law of a foreign country that have registered to do business in the United States by the filing of a document with a secretary of state or any similar office.
Are some companies exempt from the reporting requirement?
Yes, 23 types of entities are exempt from the beneficial ownership information reporting requirements. These entities include publicly traded companies meeting specified requirements, many nonprofits, and certain large operating companies.
The following list summarizes the 23 exemptions:
- Securities Reporting Issuer 2. Governmental Authority 3. Bank 4. Credit Union 5. Depository Institution Holding Company 6. Money Service Business 7. Broker or Dealer in Securities 8. Securities Exchange or Clearing Agency 9. Other Exchange Act Registered Entity 10. Investment Company or Investment Adviser 11. Venture Capital Fund Adviser 12. Venture Capital Fund Adviser 13. State-licensed Insurance Provider 14. Commodity Exchange Act Registered Entity 15. Accounting Firm 16. Public Utility 17. Financial Market Utility 18. Pooled Investment Vehicle 19. Tax-Exempt Entity 20. Entity Assisting a Tax-Exempt Entity 21. Large Operating Company 22. Subsidiary of Certain Exempt Entities 23. Inactive Entity
Please reference FinCEN’s Small Entity Compliance Guide for further information on reporting requirements and exemptions.
When do I need to report my company’s beneficial ownership information to FinCEN?
A reporting company created or registered to do business before January 1, 2024, will have until January 1, 2025 to file its initial beneficial ownership information report. A reporting company created or registered on or after January 1, 2024, and before January 1, 2025, will have 90 calendar days after receiving notice of the company’s creation or registration to file its initial BOI report. This 90-calendar day deadline runs from the time the company receives actual notice that its creation or registration is effective, or after a secretary of state or similar office first provides public notice of its creation or registration, whichever is earlier. Reporting companies created or registered on or after January 1, 2025, will have 30 calendar days from actual or public notice that the company’s creation or registration is effective to file their initial BOI reports with FinCEN.
Will there be a fee for submitting a beneficial ownership information report to FinCEN?
No. There is no fee for submitting your beneficial ownership information report to FinCEN.
How will I report my company’s beneficial ownership information?
If you are required to report your company’s beneficial ownership information to FinCEN, you will do so electronically through a secure filing system available via FinCEN’s BOI E-Filing website (http://boiefiling.fincen.gov).
Where can I find the form to report?
Access the form by going to FinCEN’s BOI E-Filing website (https://boiefiling.fincen.gov) and select “File BOIR.”
Is a reporting company required to use an attorney, certified public accountant, enrolled agent, or other service provider to submit beneficial ownership information to FinCEN?
No. FinCEN expects that many, if not most, reporting companies will be able to submit their beneficial ownership information to FinCEN on their own using the guidance FinCEN has issued. Reporting companies that need help meeting their reporting obligations can consult with professional service providers, such as lawyers, accountants, or enrolled agents.
Direct Link to FinCEN’s Beneficial Ownership Information FAQs:
https://www.fincen.gov/sites/default/files/shared/BOI-FAQs-QA-508C.pdf