What You Need to Know About the New BOI Filing Requirement for Small Businesses
Starting January 1, 2025, many small businesses will need to file a Beneficial Ownership Information (BOI) report, a new federal requirement designed to boost transparency and reduce fraud. If your business operates as an LLC, corporation, or similar structure, this may apply to you! Here’s a quick guide to understanding the BOI requirement and making sure your business is in compliance.
So, What Is BOI, and Why Does It Matter?
BOI, short for Beneficial Ownership Information, is a new reporting rule under the Corporate Transparency Act managed by FinCEN (Financial Crimes Enforcement Network). This rule requires certain businesses to submit details on who owns or controls them. The goal is to prevent fraud and protect the integrity of businesses operating in the U.S. It’s a way to boost legitimacy and transparency for businesses everywhere.
Does BOI Apply to Your Business?
For most small and medium-sized businesses, the answer is likely “yes.” This includes LLCs, corporations, and similar entities. Some groups, like large public companies and specific exempt organizations, may not need to file. If you’re unsure, it’s worth checking to be certain your business is covered.
What Do You Need to Include in a BOI Report?
The BOI report is straightforward: it requires basic information on your business’s "beneficial owners"—those who own or control the business. Here’s what you’ll need for each owner:
Full name
Date of birth
Home address
Government ID number (like a driver’s license or passport)
Gathering this information in advance will make the filing process smooth and hassle-free.
Key Deadlines for BOI Filing
Here’s when you need to file:
For Businesses Formed Before 2024: Your BOI report is due by December 31, 2024.
For New Businesses Formed in 2024 or Later: You have 90 days from the formation date to submit the report.
If Ownership Changes: Any updates to ownership or control must be filed within 30 days of the change.
It’s a good idea to mark these dates to avoid the last-minute scramble!
How Do You File a BOI Report?
Filing is easy through the FinCEN portal, which is accessible and user-friendly:
Gather the required ownership information.
Log into the FinCEN portal and fill out the report.
Submit your information and confirm. Done!
What Happens If You Don’t File?
Missing the BOI filing deadline can result in penalties and fines. To stay in good standing and avoid potential issues, be sure to file on time.
With a little preparation, you can stay on top of BOI filing and keep your business running smoothly.