The Corporate Transparency Act (CTA) introduced new reporting requirements for many companies doing business in the United States. The goal is to combat money laundering and other financial crimes. Here is what you need to know about Beneficial Ownership Information (BOI) reporting.
Who Needs to Report?
Most corporations, LLCs, and other entities created in or registered to do business in the US must report information about their beneficial owners. A beneficial owner is any individual who, directly or indirectly, exercises substantial control over the company or owns/controls at least 25% of its ownership interests.
What Information is Required?
For each beneficial owner, you must provide:
- Full legal name
- Date of birth
- Current residential address
- A unique identifying number from a valid ID (like a passport or driver's license) and an image of that ID.
Deadlines
Existing Companies: Companies created before January 1, 2024, have until January 1, 2025, to file their initial BOI report.
New Companies: Companies created in 2024 have 90 days after receiving notice of creation to file. Companies created on or after Jan 1, 2025 will have 30 days.
Penalties
This is serious business. Willful failure to report can result in civil penalties of up to $500 for each day the violation continues, and criminal penalties including imprisonment for up to two years and/or a fine of up to $10,000.
How to File
You can file electronically through the FinCEN BOI E-Filing System. It is free to file directly, or you can use a service provider like Startifyz to ensure accuracy and compliance.
