Below is a subset of the preliminary information to consider as we approach the implementation period for this new reporting requirement. More information is included in the attached PDF’s.
What entities are required to comply with the CTA’s BOI reporting requirement?
Domestic companies required to report include corporations, limited liability companies (LLCs) or any similar entity created by the filing of a document with a secretary of state or any similar office under the law of a state or Indian tribe.
Are there any exemptions from the filing requirements?
Yes, but not many, the most likely exemption is businesses that only have a business license and other domestic entities that are not created by the filing of a document with a secretary of state or similar office and tax-exempt entities
Who is a beneficial owner?
Any individual who, directly or indirectly, either (definitions in PDF):
- Exercises “substantial control” over a reporting company, or
- Owns or controls at least 25 percent of the ownership interests of a reporting company
When must companies file?
- New entities created in 2024 or after — must file within 30 days (may change to 90)
- Existing entities (pre 2024) — must file by 1/1/25
- Any changes to the entity — must file within 30 days
What sort of information is required to be reported?
Companies must report the following information: full name of the reporting company, any trade name or doing business as (DBA) name, business address, state or Tribal jurisdiction of formation, and an IRS taxpayer identification number (TIN).
Additionally, information on the beneficial owners of the entity and for newly created entities, the company applicants of the entity is required. This information includes — name, birthdate, address, and unique identifying number and issuing jurisdiction from an acceptable identification document (e.g., a driver’s license or passport) and an image of such document.
Understand your reporting requirement.
Penalties for willfully not complying with the BOI reporting requirement can result in criminal and civil penalties of $500 per day and up to $10,000 with up to two years of jail time. Please contact our office today at www.dandofinancial.com to schedule an appointment to discuss. As always, planning ahead can help you comply and understand your filing obligations.
Collin Dando, CPA