As some of you have no doubt heard, there is a new reporting requirement for many companies beginning January 1, 2024. The “Beneficial Ownership Information” (BOI) was a part of the 2021 Corporate Transparency Act (CTA) enacted by Congress.
This filing will be administered by the Financial Crimes Enforcement Bureau (FINCEN) and is meant to provide additional resources to combating money laundering and other financial crimes through offshore mechanisms.
While, in most cases, the reporting will be relatively straightforward, we at Woods & Associates, P.C. WILL NOT be able to prepare these filings. Because of the unclear guidance until recently and the continued updated monitoring needed we are not sufficiently prepared to offer this as an additional service to our clients.
In addition, there are significant penalties for incorrect/incomplete filings that add considerable risk to our engagements. Adding this service and the associated potential liability would likely require us to raise our fee structures CONSIDERABLY.
What you need to know:
- Almost all LLCs and Corporate entities will need to submit this report through the FINCEN website
- Each entity will need to register their entity with FINCEN in order to file the report
- If your entity was created or registered prior to 1/1/2024, you have until 1/1/2025 to file your initial report
- If your entity is created or registered in calendar 2024, you will have 90 days to file your initial report (from the date of entity acceptance/registration)
- If your entity is created or registered AFTER 1/1/2025, you will have 30 days to file your initial report
- Updates or corrections to your BOI filing are due within 30 days
Here is a link to the BOI info sheet on the FINCEN website: https://www.fincen.gov/sites/default/files/shared/BOI%20Informational%20Brochure%20508C.pdf
Our advice is to include this BOI filing as a part of any entity formation. In other words, utilize the service of your corporate formation attorneys to prepare this filing at the formation of your entity. There also are some service providers that are available to assist you with the preparation and filing of these reports.
In the vast majority of cases, clients should be able to prepare and submit the BOI themselves. It does take a bit of time to set up a FINCEN account and gather the required documentation. The sign in information can be found on the BOI landing page here:
We may reconsider our position on this in the future. But at this time the uncertainty and potential liability associated with this program we are not able to prepare BOIs.
Here are a couple of resources for companies that are assisting entities prepare and submit BOI. We have not vetted them in any way and accordingly can’t speak to their service offering.