The following information provided for SAFE’s Business Banking and Commercial Lending members is from the FinCEN website.
Many small businesses are required to report their beneficial ownership information (BOI) directly to the Treasury Department’s Financial Crimes Enforcement Network (FinCEN) effective January 1, 2024.
This requirement was put in place in early 2024 as part of the Corporate Transparency Act that aims to curb illicit finance, counter money laundering and the financing of terrorism. To comply, companies need to report information to FinCEN about the individuals who own or control them.
Filing is simple, secure, free of charge and only needs to be submitted once, unless the filer needs to update or correct information. Most companies should be able to complete the report without the assistance of an accountant or lawyer. For companies with a simple ownership structure, filing may take less than 20 minutes.
Deadlines to File
Companies required to comply must file their initial reports by the following deadlines:
- Existing companies:
- Reporting companies created or registered to do business in the United States before January 1, 2024, must file by January 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.
- Beginning in 2025, newly created or registered companies will have 30 days.
Who Needs to File?
This specific process is for smaller companies and corporations, as larger businesses already report this information to federal regulators through other means. The following companies should report their BOI through this process:
- a corporation, a limited liability company (LLC), or was otherwise created in the United States by filing a document with a secretary of state or any similar office under the law of a state or Indian tribe; or
- a foreign company that was registered to do business in any U.S. state or Indian tribe by such a filing.
For more information about whether a company needs to file, visit fincen.gov/boi.
What Do Companies Need to Report?
Reporting companies need to report just a few pieces of information about themselves and their beneficial owners, such as name, address, and date of birth. More information is available here.
Where can reporting companies file?
Companies can file at https://boiefiling.fincen.gov/ or visit https://www.fincen.gov/boi for more information.
Who Can Access BOI?
The database uses 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.
The information is available by request from:
- Federal, state, local, and tribal officials, as well as certain foreign officials who submit a request through a U.S. federal government agency, for authorized activities related to national security, intelligence, and law enforcement;
- Financial institutions with the consent of the reporting company;
- Financial institutions’ regulators.
Penalties for Not Filing
A person who violates beneficial ownership reporting requirements may be subject to civil penalties of up to $591 for each day that the violation continues, as well as criminal penalties of up to two years imprisonment and a fine of up to $10,000. Potential violations include willfully failing to file a beneficial ownership information report, willfully filing false beneficial ownership information, or willfully failing to correct or update previously reported beneficial ownership information.
For more information, visit the FinCEN website.
