Own an LLC? Guess what, new reporting requirements outside of Tax Return Starting in 2024

Do you own an LLC, C Corporation, S corporation, or partnership? Now, you must report this yearly through FinCEN (Financial Crimes Enforcement Network) or face potential outrageous penalties, fines, and even the threat of imprisonment (queue in scary New World Order music). These fines for non-compliance are $500 per day of civil penalties for non-reporting, a $10,000 fine, and two years of imprisonment. Yikes.

New Federal Reporting Requirement for Beneficial Ownership Information (BOI)

Beginning on January 1, 2024, many companies in the United States will have to report information about their beneficial owners, i.e., the individuals who ultimately own or control the company. They must report the information to the Financial Crimes Enforcement Network (FinCEN). FinCEN is a bureau of the U.S. Department of the Treasury.

Who Has to Report?

Companies required to report are called reporting companies. Reporting companies may have to obtain information from their beneficial owners and report it to FinCEN.

How Do I Report?

Either through the FinCen website or contact me at nick@genesistaxconsultants.com and have it professionally prepared and filed through Genesis Tax Consultants, LLC.

Who Does Not Have to Report?

Twenty-three types of entities are exempt from the beneficial ownership information reporting requirements. These entities include publicly traded companies, nonprofits, and certain large operating companies.

When Do I Report?

Reports will be accepted starting on January 1, 2024.

• If your company was created or registered prior to January 1, 2024, you will have until January 1, 2025 to report BOI.

• If your company is created or registered on or after January 1, 2024, you must report BOI within 30 days of notice of creation or registration.

• Any updates or corrections to beneficial ownership information that you previously filed with FinCEN must be submitted within 30 days.

FinCEN cannot accept reports before January 1, 2024.

ntroduction

FinCEN is publishing this Small Entity Compliance Guide (Guide)1

to help small entities

comply with the requirements of the Beneficial Ownership Information Reporting Rule

(referenced in this Guide as the Reporting Rule). In particular, small entities may have new

requirements under the Reporting Rule. FinCEN is committed to ensuring that the small

business community and other reporting companies have the tools they need to comply with

the new requirements, and that the process is as smooth and streamlined as possible. FinCEN

is striving to reduce the burden on small businesses by providing comprehensive guidance and

communicating information about the reporting requirements in plain language.

The Reporting Rule requires certain entities to file beneficial ownership information (BOI)

reports (referenced in this Guide as BOI reports or reports) to FinCEN. Reports contain

information about the entity itself and two categories of individuals:

1. Beneficial owners

2. Company applicants

These terms will be described in detail later in this Guide, but in general, a beneficial owner is

an individual who owns or controls at least 25 percent of a company or has substantial control

over the company, and a company applicant is an individual who directly files or is primarily

responsible for the filing of the document that creates or registers the company.

The Reporting Rule, issued on September 30, 2022, implements Section 6403 of the Corporate

Transparency Act. The rule describes who must file BOI reports, what information they must

provide, and when they must file the reports.

The Reporting Rule is found at 1010.380 in title 31 of the Code of Federal Regulations

(CFR). An electronic version is also available through FinCEN’s website. Specific sections

of the Reporting Rule are cited throughout this Guide using the citation “1010.380[paragraph

number].” Appendix A to this Guide provides an index of where this Guide cites to the different

parts of the regulation. This Guide covers all the provisions of 1010.380.

Starting on January 1, 2024, BOI reports must be filed electronically using FinCEN’s secure

filing system. FinCEN will store BOI reports in a centralized database and only share this

information with authorized users for purposes specified by law. The database will use rigorous

information security methods and controls typically used in the Federal government to protect

non-classified yet sensitive information systems at the highest security level.

When do I need to file a report?

• Reports will be accepted starting on January 1, 2024.

• Reporting companies created or registered to do business before January 1, 2024, will

have additional time — until January 1, 2025 — to file their initial BOI reports.

• Reporting companies created or registered on or after January 1, 2024, will have 30

days after receiving notice of their company’s creation or registration to file their initial

BOI reports.

Where can I find additional information about BOI reporting?

• Additional information about the Reporting Rule and guidance materials are available at

www.fincen.gov/boi.

• FinCEN has issued and will continue to issue frequently asked questions to address

specific questions on the topic. They can be found here: www.fincen.gov/boi-faqs.

• In addition, if you have any questions regarding BOI reporting obligations, you should

contact FinCEN at www.fincen.gov/contact.