Beneficial Owner Information Reporting Now Required
UPDATE 12/03/2024- A federal court in the Eastern District of Texas has temporarily enjoined enforcement of the BOI reporting requirement nationwide. However, that does not mean the law is repealed or the injunction will remain in place. Contact us with questions about your reporting requirements.
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The Corporate Transparency Act now requires all companies formed in the United States to file a report with FinCEN that identifies all individuals who own or control at least 25% of the ownership interests in the company. Under the Act, an “ownership interest” includes equity, stock, or voting rights; a capital or profit interest; convertible instruments; options or other non-binding privileges to buy or sell any of the foregoing, and any other instrument, contract, or other mechanism used to establish ownership.
The report is due not later than December 31, 2024 for companies that existed prior to January 1, 2024, or within ninety days of formation for companies formed in 2024 and thirty days for companies formed in 2025 or later. Reporting is also required within thirty days anytime there is a change to previously reported information.
Certain companies that operate in regulated industries are exempt. Exemptions are provided for twenty-three different categories of entities, including SEC registrants, banks, money service businesses, broker-dealers in securities, insurance companies, accounting firms, investment companies, and inactive companies.
Federal law provides civil penalties of up to $500 per day for willful failure to report or to provide false or incomplete information and criminal penalties of up to two years imprisonment and a fine of up to $10,000.
If you haven’t filed your Benenficial Owner Information Report yet, we can help! Contact us for more information.
