We have received several client inquiries recently regarding the new Beneficial Ownership Information (BOI) reporting requirements established by the U.S. Department of Treasury under The Corporate Transparency Act (“CTA”).
The CTA is intended to address and guard against money laundering, terrorism financing, and other forms of illegal financing by mandating certain entities (primarily small and medium-sized businesses) to report “beneficial ownership” information to the Financial Crimes Enforcement Network (“FinCEN”). This regulation requires certain entities to report ownership information to FinCEN, with the first filing due by January 1, 2025, and others within 30 and 90 days of certain activities.
As a licensed CPA firm, we are not allowed to offer or give legal advice and are therefore governed by an “unauthorized practice of law.” Due to differing views in the State of Colorado and other states where our clients reside and operate, we are unable to assist or advise you and/or an entity you may be affiliated with regarding these filings at this time. Certain matters of the CTA involve offering or rendering an opinion on who may be a beneficial owner of an entity. The CTA is NOT part of the tax code and falls out of the scope of accounting services and income tax preparation.
We encourage you to review these requirements to ensure compliance and avoid penalties. Consult your attorney on the potential requirements and file any necessary filings if applicable to you and/or an entity you have beneficial ownership of.
Below is an overview of the requirements:
Who Must File:
- Domestic corporations, LLCs, and similar entities.
- Foreign entities registered to do business in the U.S.
- Review specific rules related to trustee, beneficiary, and executors of trusts.
Who is Exempt:
(not an all-inclusive list, there are 23 specific exemptions)
- Larger operating companies (with over 20 full-time U.S. employees and $5 million in gross receipts).
- Regulated entities, such as publicly traded companies and financial institutions.
Key Deadlines:
- Initial Filing: January 1, 2025, for existing entities. Entities formed after January 1, 2024, must file within 30 days of creation.
- Annual Updates: Any changes to ownership information must be reported within 30 days.
Where to File:
- Reports must be filed electronically with FinCEN via their online portal.
More information:
- https://boiefiling.fincen.gov/help
- https://www.fincen.gov/boi-faqs
- Review state community property statutes, if applicable.
- When searching for “BOI,” there are third parties advertising to offer the service to complete this for you, these are PAID services.
FAQs – Your Company Impact
Find out more in the BOI CTA FAQs, including:
- Who is required to report under the CTA’s BOI reporting requirement?
- When must companies file?
- What information do companies need to report?
- What are the penalties for non-compliance with the statute?
Previously, information about the Corporate Transparency Act was shared on our blog, in newsletters, and on social media. Now, however, is the time to act.
This message is provided as general educational information on the topic and to remind you of any potential obligations you may have.