Corporate Transparency Act Reporting Starts

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FinCEN requires Beneficial Ownership Information

Let the Reporting Begin! FinCEN Registry Corporate Transparency Act Reporting Starts

On January 1, 2024, the Treasury Department’s Financial Crimes Enforcement Network (FinCEN) began accepting beneficial ownership information reports on their online registry. This mandatory reporting is part of the Corporate Transparency Act. It is designed to deter shell companies from engaging in money laundering, drug trafficking, corruption, and other illicit activities by identifying the owners. FinCEN now requires companies to disclose who truly owns or controls them.

Unfortunately, many innocent companies now have the added challenge to complete additional reporting on businesses and their accountants. Existing companies will have one year to file, while new companies will be required to file within 90 days of their creation or registration.

When Do I Report to FinCEN?

All small businesses and entities subject to the new rule will collect, document and submit previously unreported beneficial ownership information (BOI) to FinCEN. The online registry is now open for BOI reports. Companies are required to comply with the FinCEN BOI rules or face penalties. Here are the deadlines:

  • Existing companies: Reporting companies created or registered to do business in the United States before Jan. 1, 2024, must file by Jan. 1, 2025.
  • Newly created or registered companies: Reporting companies created or registered to do business in the United States in 2024 have 90 calendar days to file after receiving actual or public notice that their company’s creation or registration is effective.

What Do I Report to FinCEN?

Beneficial ownership information reporting is not an annual requirement. A BOI report only has to be submitted once, unless the filer needs to update or correct information. In general, reporting companies has to provide four pieces of information about each beneficial owner:

  • Name;
  • Date of birth;
  • Address; and,
  • The identifying number and issuer from either a non-expired U.S. driver’s license, a non-expired U.S. passport, or a nonexpired identification document issued by a State (including a U.S. territory or possession), local government, or Indian tribe. If none of those documents exist, a non-expired foreign passport can be used. An image of the document must also be submitted.

The company also needs to submit specific information about itself, such as its name(s) and address. Along with that, reporting companies created on or after Jan. 1, 2024, are required to submit information about the individuals who formed the company (that is, the “company applicants”).

FinCEN has also posted a Small Entity Compliance Guide that helps small businesses navigate the requirements in plain language. Filers can also view informational videos and webinars about the BOI requirements, find answers to frequently asked questions, connect to the contact center, and learn more about how to report at www.fincen.gov/boi.