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Beneficial Ownership Information Reporting Requirements - What You Need to Know

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This article is meant for informational purposes only. 
Foster & Motley does not file BOI reports on behalf of our clients or others.

Do you have ownership in a business with an entity structure such as an LLC, partnership, S-Corp, or C-Corp?

If so, this article is for you.  In 2021, Congress passed the Corporate Transparency Act which created a new beneficial ownership information (BOI) reporting requirement for companies with certain entity structures.  The BOI requirement was implemented to help law enforcement and regulators counter money laundering and the financing of terrorism.  The intent of this article is to help you understand the reporting requirements, the timeline for filing a BOI report, and the exceptions to having to file. First a few key points:
  • Most businesses with an entity structure will be required to file a BOI report.  
  • BOI reports will be filed with the Financial Crimes Enforcement Network (FinCEN).
  • There is no fee to file this form. 
  • The FinCEN website to file reports is  
  • BOI Reports cannot be submitted to FinCEN until January 1, 2024. 

Now, let’s talk about the new rules. 

Does your company qualify as a reporting company?

Entities are required to report BOI to FinCEN if they meet the definition of a “reporting company” and do not qualify for an exemption (more on exemptions later).  There are two categories of reporting companies: a “domestic reporting company” and a “foreign reporting company.”  For purposes of this article, we are only going to discuss domestic reporting companies.  The BOI Small Entity Compliance Guide includes this flow chart in section 1.1 that is very helpful, but we’ll break it down for you here as well.

What is a domestic reporting company?

A domestic reporting company is a corporation or LLC or any other entity created by the filing of a document with a Secretary of State or similar office in the United States under the law of a state or Indian tribe. For this purpose, the United States includes any state of the United States, the District of Columbia, the Commonwealth of Puerto Rico, the Commonwealth of the Northern Mariana Islands, American Samoa, Guam, The US Virgin Islands, and any other commonwealth, territory, or possession of the United States.

Who qualifies for an exemption to the reporting?

The reporting rule exempts 23 specific types of entities from the reporting requirements. Most of these exempt entities operate in industries already heavily regulated by Federal or State authorities. Here is a sample of just a few:  banks, credit unions, accounting firms, public utilities, large operating companies, insurance companies, investment companies or investment advisers, and inactive entities.  You can see the full list on page four of the BOI Small Entity Compliance Guide

Who is a beneficial owner of my company?

Assuming your company qualifies as a reporting company then you must identify the company’s beneficial owners.  A beneficial owner is any individual who, directly or indirectly:

  • Exercises substantial control over a reporting company; OR
  • Owns or controls at least 25 percent of the ownership interests of a reporting company

Substantial Control an individual exercises substantial control over a reporting company if the individual meets any of four general criteria: 

  1. The individual is a senior officer (President, CFO, General Counsel, CEO, COO, or any other officer, regardless of official title, who performs a similar function as these officers.)
  2. The individual has the authority to appoint or remove certain officers or a majority of directors of the reporting company.
  3. The individual is an important decision-maker.
  4. The individual has any other form of substantial control over the reporting company. (This is a catch-all in which any other form of substantial control is not outlined above.)

Ownership Interests Any of the following may be an ownership interest:  equity, stock, or voting rights; a capital or profit interest; convertible instruments; options or other non-binding privileges to buy or sell any of the foregoing: and any other instrument, contract, or other mechanism used to establish ownership.

Does my company have to report its company applicants?

For companies that are formed after January 1, 2024, there is an additional reporting responsibility related to company applicants.  Company applicants can be a direct filer or the individual who directs or controls the filing action.  A direct filer is the individual who directly filed the document that created a domestic reporting company or the individual who directly filed the document that first registered a foreign reporting company.  This individual would have physically or electronically filed the document with the secretary of state or similar office.  The other possible company applicant is the individual who was primarily responsible for directing or controlling the filing of the creation or first registration document.  This individual is a company applicant even though the individual did not actually file the document with the secretary of state.

What information is being collected by this report?

Beneficial ownership information refers to identifying information about the individuals who directly or indirectly own or control a company.  Identifying information can be broken down into two pieces.  The first is information about the company itself and the second piece is information about the owners of the company.  Reporting companies must provide the following information:

Company Information                                   

  • Full legal name
  • Any trade names used by the company (doing business as or trading as) 
  • The current street address of the company’s principal place of business (PO box or third-party addresses will not be accepted)
  • The jurisdiction in which the company was formed or registered
  • Taxpayer Identification Number

  Owner Information

  • Full legal name
  • Date of birth               
  • Current residential street address
  • An identifying number from a non-expired, government-issued photo ID, such as a US passport or driver’s license along with the name of the issuing state or jurisdiction of identification documentation
  • An image of the government-issued photo ID from which the above number was provided

When and how often does this report need to be filed?

Reporting companies that are in existence as of December 31, 2023, will be required to file a BOI report between January 1, 2024, and December 31, 2024 (FinCEN has not yet released the form or mechanism for submission and will not accept filings before January 1, 2024).  This will be a one-time filing unless there are future changes to any information or the discovery of erroneous information in the filed report.  If there are any changes to the required information about your company or its beneficial owners, then an updated report must be filed no later than 30 days after the change. 

For reporting companies that are created or registered to do business in the US  between January 1, 2024, and January 1, 2025, the report will be due within 90 days after receiving the actual or public notice that the entity creation or registration is effective. For reporting companies created or registered after January 1, 2025, the report will be due within 30 days.

What happens if I don’t report BOI within the required timeframe?

The willful failure to report complete or updated beneficial ownership information to FinCEN may result in civil or criminal penalties, including civil penalties of up to $500 for each day that the violation continues, or criminal penalties including imprisonment for up to two years and/or a fine of up to $10,000.  Senior officers of an entity that fails to file a required BOI report may be held accountable for that failure.

What is a FinCEN Identifier and do I need one?

A FinCEN identifier is a unique identifying number that FinCEN will issue to an individual or reporting company upon request after the individual or reporting company provides certain information to FinCEN.  In order to obtain a FinCEN Identifier an individual must provide the same information as outlined above.  Once a beneficial owner or company applicant has obtained a FinCEN identifier, reporting companies may report it in place of the otherwise required personal information about the individual in BOI Reports.  You are not required to obtain one, but if you are an owner or company applicant in many businesses it may be useful to obtain one in lieu of providing the required information to each Reporting Company you may be a beneficial owner in or a company applicant of.


Every company should evaluate these requirements and determine how they will move forward with filing the relevant reports. For many small businesses, the reporting should be fairly straightforward, but with the hefty potential penalties, it is important that this requirement is handled timely and according to the rules provided. Contact our team if you’d like help understanding the requirements.