Admin

13 Answers on the New 2024 CTA Required BOI Reporting to FinCEN

By
Industry Observer with Green Krist CPA PLLC 34463

The Corporate Transparency Act (CTA) is upon us. It takes effect on January 1, 2024, and imposes a new federal filing requirement for most corporations, limited liability companies (LLCs), and other business entities.

Corporations, LLCs, and other entities subject to the CTA are called “reporting companies.” People who form new reporting companies must file a beneficial ownership information (BOI) report with the Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) within 90 days of forming the company.

The owners of reporting companies created before 2024 must also file a BOI report, but they have until January 1, 2025 (but think December 31, 2024).

Some businesses are exempt from filing—for example, large operating companies with over 20 employees and $5 million in income. There are other, more narrow exemptions as well.

The BOI report must contain the name, the birth date, the address, and an ID number and image of that ID for each “beneficial owner” of the reporting company. These are the human beings who (1) own or control at least 25 percent of the company or (2) exercise “substantial control” over the company.

The BOI report is filed online at a new federal database called BOSS (an acronym for Beneficial Ownership Secure System). There is no filing fee.

Government law enforcement and security agencies will use the data from BOI reports to help combat money laundering, tax evasion, terrorism, and other crimes. It will not be available to the public.

Naturally, people have lots of questions about the BOI report filing requirements—for example:

  • Do you have to file a BOI report if you own a single rental property in an LLC? (Yes.)
  • Do you have to file 10 BOI reports if you own 10 LLCs? (Yes.)
  • Can certified public accountants, enrolled agents, and other non-lawyers file BOI reports for clients without running afoul of unauthorized practice of law rules? (Unclear.)
  • Are registered agents responsible for filing the BOI report? (No.)
  • Do the self-employed have to file? (No.)
  • Do I need to list a street address in the BOI report? (Yes.)
  • Do I need to list my Social Security number in the BOI report? (No.)
  • Do I need to list my attorney in the BOI report? (Maybe.)
  • Must I file an updated BOI report if a beneficial owner leaves the company? (Yes.)
  • Do I have to list my minor child in a BOI report? (No.)
  • Will criminals file BOI reports? (Who knows?)

These are some basic answers but if you’d like more information, FinCEN’s Small Entity Compliance Guide walks small businesses through the requirements in plain language. Filers can also view informational videos and webinars, find answers to frequently asked questions, connect to the contact center, and learn more about how to report at www.fincen.gov/boi.

Green Krist, CPA  specializes in assisting taxpayers with IRS and North Carolina Department of Revenue issues in the greater Raleigh, North Carolina area.

Show All Comments Sort:
Joyce M. Marsh
Luxury Home Couture - Daytona Beach, FL
Joyce Marsh Homes & Design

Thank you for providing this information for business owners regarding the filing requirements  

Jan 07, 2024 10:52 PM
Kat Palmiotti
eXp Commercial, Referral Divison - Kalispell, MT
Helping your Montana dreams take root

What about non-profits? Do they have to file?

Jan 08, 2024 05:08 AM
Kelly Green-Krist

The Reporting Rule exempts twenty-three (23) specific types of entities from the reporting requirements. Tax-exempt entities are one of the exemptions.

Jan 09, 2024 11:36 AM