Update: Congress is delaying the requirement to register older LLCs (created before January 1st, 2024) until January 1st, 2026. For entities created during 2024 or later, you still have to register those within 30 days. We recommend just going ahead and registering all LLCs. But if you choose to wait to file it, keep a close eye on news of future changes to the requirement.
Anyone who has an LLC needs to be aware of the beneficial ownership information (BOI) reporting requirements that are coming into effect starting January 1st, 2024. Previously there were no federal reporting requirements for LLCs and small corporations, so this is a major new change. And the fines for not reporting are steep ($500 to $10,000 per violation, plus potentially jail time). So this is something anyone with an LLC needs to be aware of.
These reporting requirements were enacted as part of the US Corporate Transparency Act (CTA). These requirements aim to enable the federal government to identify the owners of LLCs and corporations, empowering them to combat fraud, money laundering, etc.
This isn’t a tax form, it’s a legal form, and so most tax accountants aren’t offering completion of this form as a service. It’s also currently unclear if tax accountants can legally offer this as a service since it may be considered practice of law, at least in some states.
Who Has to File
Most LLCs, corporations, limited partnerships, or other similar entities. So if you have an LLC, such as one holding a rental property, this filing requirement applies to you.
It doesn’t apply to individuals without an LLC (rental properties or a business in your own name rather than an LLC).
There are also some exceptions for other situations, like banks, nonprofits, and large companies with (more than 20 US employees and $5 million in revenue) because those nonprofits and large companies already have other similar federal reporting requirements. But people with small businesses and rental properties will generally need to file.
How to File
The reports aren’t filed with the IRS, they are filed with the Financial Crimes Enforcement Network (FinCEN). If you have an existing entity, you must file the first report by the end of 2025. If you register a new LLC or entity during 2024, you must file within 30 days after it is created. Update: This was temporarily extended to 90 days during 2024.
The form requires “Beneficial Ownership Information” (BOI) information on individuals who own or control at least 25% of the LLC or corporation. The required data includes full name, date of birth, address, and a copy of approved ID such as a driver’s license or passport. The information is not made publically available, but is shared with federal criminal investigation bureaus. Under certain circumstances, you have the option to register for a “FinCEN identifier” number. This number allows you to report your information on multiple filings without the need to update each report individually in case of changes to your address or other details
You can file it online at https://www.fincen.gov/boi.
