The following is a summary to help determine if your business is required to submit a Beneficial Ownership Information (BOI) Report in compliance with the Corporate Transparency Act (CTA). Carefully review the following criteria to ascertain your reporting obligations.
Corporations, limited liability companies (LLC), partnerships or trusts that have filed formation documents with a secretary of state is required to file a BOI report, unless an exemption is met.
General Exemptions for BOI Reporting:
- Large Operating Company Exemption: Your business employs more than 20 full-time employees in the U.S, has an operating presence at a physical U.S. office, AND has annual gross revenues exceeding $5 million from U.S. sources.
- Tax Exempt Entity: Your business is classified as a tax-exempt entity.
- Exclusion of Financial Institutions: Your business is a bank, credit union, or insurance company.
- Publicly Traded Company: Your business is publicly traded and is registered under Section 102 of the Sarbanes-Oxley Act.
- Inactive Entity: Your business has been in existence since January 1, 2020 and is not engaged in an active trade or business.
If you are uncertain about the requirements or the next steps, our firm is here to guide you through the compliance process.
Timeline for Compliance:
- Existing Entities: If your entity was formed on or before December 31, 2023, you must file between January 1, 2024, and January 1, 2025.
- New Entities: Entities formed on or after January 1, 2024 must file within 90 days of their formation date.
- Changes in BOI: Any changes in previously reported information must be reported to FinCEN within 30 days.
Penalties for Noncompliance:
- Civil Penalties: Up to $500 per day for ongoing violations.
- Criminal Penalties: A fine of up to $10,000 and/or imprisonment for up to two years.
The penalties for noncompliance can be significant. Contact us today if you have any questions or require assistance with the BOI reporting process.
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