In a move to enhance corporate transparency and mitigate financial crimes, the Financial Crimes Enforcement Network (FinCEN), a bureau of the U.S. Department of the Treasury, has implemented the Corporate Transparency Act, effective January 1, 2024. Understanding the implications of this new filing requirement is crucial to business owners and executives.
WHAT IS THE CORPORATE TRANSPARENCY ACT
The Corporate Transparency Act will require most legal entities to disclose their Beneficial Ownership Information (BOI) to FinCEN. BOI includes details about individuals who directly or indirectly own or control the entity.
WHAT DOES THIS MEAN TO YOU?
The impact of the Corporate Transparency Act varies based on the registration or formation date of your business:
- Existing LLCs, Corporations, and business entities with an effective filing date established before January 1, 2024, are required to file a BOI report by January 1, 2025.
- LLCs, Corporations, and business entities created ON OR AFTER January 1, 2024, but before January 1, 2025, must file a BOI report within 90 days of their registration or formation with the Secretary of State’s office.
- LLCs, Corporations, and business entities created or registered ON OR AFTER January 1, 2025, will have 30 calendar days from registration to file their initial BOI reports with FinCEN.
Failure to comply with these deadlines may result in significant consequences, including fines of up to $500 per day for ongoing violations and criminal penalties such as imprisonment for up to two years and/or fines of up to $10,000. However, there are twenty-three exemptions, and businesses that qualify for an exemption are not required to submit BOI reports.
HOW CAN BORIS BENIC AND ASSOCIATES HELP?
Ensuring compliance with the Corporate Transparency Act is paramount. Boris Benic and Associates is well-equipped to assist you in this process, providing expert guidance on reporting requirements and assisting in the preparation of accurate and timely BOI reports.