UPDATE! New U.S. Beneficial Ownership Reporting Obligations

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Starting January 1, 2024, most US businesses will have one (1) year to file their Beneficial Ownership Report.

As noted in our blog, “ALERT! Your New US Beneficial Ownership Reporting Obligations!”:  beginning January 1, 2024, companies will be subject to increased reporting requirements. Specifically, new regulations will require the reporting of information about company’s “beneficial owners” to the U.S. Treasury’s Financial Crimes Enforcement Network (FinCEN). These changes come from a final ruling based on the Corporate Transparency Act (CTA), an anti-money laundering statute designed to combat illegitimate financial activity and promote transparency.

Who Has to File

As noted in our previous blog post there are 23 exemptions.  However, the majority of companies -no matter how small – will be required to submit a Beneficial Ownership Information (BOI) report. FinCEN has created a small entity compliance guide to aid business owners in determining if their company has to file.  Unfortunately, the determination that your company “may be” a reporting company is not exactly…er, determinative.  (Reach out if we can help!)

Where to File

Starting on January 1, 2024, companies may follow this link to file their BOI reports via FinCEN’s BOSS platform: https://www.fincen.gov/boi. Per government notice, the link to file your report will not be operable until January 2024.

Question Only FinCEN Can Answer.

To determine what needs to be in the filing, or if you have questions that can only be answered by FinCEN, please follow the link here to read through their FAQs: https://www.fincen.gov/boi-faqs#C_2. Within the FAQs they discuss everything from general questions to the reporting process, to what a beneficial owner is, and reporting requirements.

Consequences of Non-Compliance

Non-compliance may result in significant penalties for both companies and individuals.

  • Willful failure to file a complete initial/updated report can lead to US$500/day fines (up to US$10,000) and/or up to two (2) years imprisonment.
  • Knowingly disclosing BOI without authorization report can lead to US$500/day fines (up to US$250,000) and/or up to five (5) years imprisonment.

We understand that this may be a confusing process and we are happy to help. Please reach out to us if you have any questions or concerns!

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