As of January 1st, 2024, new BOI filing requirements for Domestic Reporting Companies (DRCs) and Foreign Reporting Companies (FRCs) could require your action by January 1st of 2025.

What is BOI?

BOI or Beneficial Ownership Information Reporting is a requirement for individuals and/or entities to disclose any and all true owners or beneficiaries of assets, companies, trusts, or other entities to help tax authorities and other regulators negate tax evasion, money laundering, and other financial crimes. The reason this requirement exists is because sometimes, an individual may not be listed as an official owner on a legal document but may be the actual owner of a company or asset, so it helps keep everyone above-board.

Someone who indirectly or directly exercises substantial control over an asset, company, etc. or owns/controls 25% or more of an asset, company, etc. fits the bill of a beneficial owner.

Now, how do BOI Reporting changes affect you? The short answer: they might not. However, businesses identified as reporting companies – mainly LLCs, S Corps, and C Corps – will have additional reporting requirements starting this year (2024) as dictated by the Corporate Transparency ACT (CTA) in an effort to fight against money laundering activities. What do you do from here?

As of the first of this year, there is an electronic filing system available with a form to report BOI. All DRCs and FRCs meeting the criteria will have 30 days from establishment or registration to file as of Jan. 1, 2025. Any businesses existing prior to Jan. 1, 2024 that meet the criteria must file by Jan. 1, 2025.

Violation of these requirements could result in civil and/or criminal penalties; specific examples include: a fine of $591 per day with a cap of $10,000 and/or imprisonment up to 2 years.

If you need any other information or just want to read the official source yourself, here is the BOI webpage.

At Genovations Accounting, we’re here not only to help you manage your financial situation day-to-day, but also to look out for you down the road.

Got concerns of your own? Schedule a financial consultation with us!