New U.S. Business Requirement: File Your Beneficial Ownership Information (BOI)

Sep 8

This blog post is here to help you understand the new FinCEN BOI reporting requirement for businesses. Don't worry, it's not as complicated as it sounds!

Who Needs to File?

In short, most U.S. companies registered with the Secretary of State (corporations, LLCs, etc.) need to file a BOI report. There are exceptions, though. Here are the most common ones for small businesses:

Tax-exempt organizations (501(c) entities)
Large operating companies (over 20 full-time US employees, physical US office, and over $5 million in annual revenue)
Truly inactive companies (meeting specific criteria)

What Information Do I Need?

The BOI report focuses on your company's "beneficial owners." These are the individuals who:

Own or control at least 25% of the company
Have significant control over company decisions (senior officers, appoint/remove officers, etc.)

For most small businesses, identifying beneficial owners should be straightforward. If you have questions about "substantial control," FinCEN's FAQ or an attorney can help.

When Do I File?

New companies (formed in 2024): Within 90 days of formation.
Existing companies: By January 1, 2025.
New companies (formed in 2025 and after): Within 30 days of formation.
Updates: Anytime there's a change in ownership, company information, or existing owner details (within 30 days).

There's no annual filing, but keep the report updated!

How Do I File?

It's all online at https://boiefiling.fincen.gov/. The website also has helpful guides and resources.

Why Does This Matter?

This requirement helps fight money laundering and other illegal activities. Penalties for non-compliance are serious (fines and jail time).

Heidi Franz

With a career spanning over 15 years in small business accounting, Heidi brings her passion and expertise of the accounting industry to Paraclete Financial, LLC. She is deeply invested in understanding and supporting the unique financial journey of small businesses. Her approach is driven by care for her clients and their unique business challenges. She brings a strong understanding of the importance of accuracy, compliance, and strategic financial management, and is dedicated to ensuring that every step of your financial journey is guided with expertise and empathy.