The Corporate Transparency Act’s Beneficial Ownership Information (BOI) Report

The Corporate Transparency Act’s Beneficial Ownership Information (BOI) Report

In 2021, the Corporate Transparency Act (CTA) was enacted by Congress to help thwart the illicit activities of shell companies. Effective January 1, 2024, the CTA requires certain companies to report information on their beneficial owners.

The Beneficial Ownership Information (BOI) report must be filed through the Financial Crimes Enforcement Network (FinCEN) with the due date dependent upon the date of formation of the company.

Filing Deadline Breakdown
The current filing deadlines include:

  • Companies in existence before January 1, 2024, the filing deadline is January 1, 2025.
  • Companies formed after January 1, 2024 and before January 1, 2025, the BOI must be filed within 90 calendar days of the effective date of formation.
  • Companies formed January 1, 2025 or later, the BOI must be filed within 30 calendar days of the effective date of formation.

Reporting Company Criteria
Companies meeting the following criteria are required to file, unless specifically excluded because it:

  • Was formed under U.S laws
  • Is a corporation or a Limited Liability Company (LLC)
  • Has registered with a state’s Secretary of State

Foreign entities may also be required to file a BOI report if they meet certain criteria:

  • Registered to do business in a U.S. State or Tribal jurisdiction

Exemptions to Filing
There are twenty-three exemptions to the reporting requirements, however even if a company meets the requirements stated above, they may still be able to claim an exemption from reporting. Most of these exemptions relate to investment companies already regulated by the Securities and Exchange Commission (SEC), nonprofits, etc. Most LLCs should plan on not being able to meet these exemptions.

Beneficial Owners
A beneficial owner is defined as any individual who meets either one of the following criteria (either directly or indirectly):

  • Exercises substantial control over the reporting company
  • Owns or controls 25% or more of the reporting company’s ownership interest

How We Can help
At Leone, McDonnell & Roberts, P.A, we recognize that these new reporting requirements may be confusing, and we welcome the opportunity to help our clients with filing their BOI reports. Please reach out to us at any time to discuss how we may best assist you.