NPZ Law Group Reminder to Business Entities: Comply with Beneficial Ownership Reporting Requirements
Written By:
David H. Nachman, Esq.
Ludka Zimovcak, Esq.
Snehal Batra, Esq.
Samantha Oberstein, Esq.
Nachman, Phulwani, Zimovcak (NPZ) Law Group, P.C.
As of January 1, 2024, many U.S.-registered business entities may need to comply with the Corporate Transparency Act (CTA). This new act requires submitting a Beneficial Ownership Information Report (BOIR) to the Federal Crimes Enforcement Network (FinCEN) by January 1, 2025. Missing this deadline may lead to substantial civil and criminal consequences.
Who Needs to File
Businesses such as Single-Member LLCs, Multi-Member LLCs, Small S and C Corporations, and HOAs must file a BOIR that includes identifying information for all beneficial owners. This act applies to entities formed by filing with state authorities but excludes sole proprietors, general partnerships, and specific exempted companies with 20+ full-time employees and $5 million in gross receipts.
What You Need
The BOIR must include the Employer Identification Number (EIN) and ID (e.g., driver’s license or passport) for each beneficial owner. Beneficial owners include individuals with 25% or more ownership or those with significant control, such as senior officers. For entities created in 2024 or after, the BOIR should be submitted within 90 days of the formation date. Any updates to beneficial ownership details should be reported within 30 days of a change.
Filing Process
Reports can be submitted online via FinCEN’s portal here, with no associated fees. Filing directly on FinCEN’s secure portal helps safeguard your information. FinCEN also provides a Compliance Guide and FAQs to assist with the process.
Third-Party Solicitations
Be cautious of third-party services that offer filing assistance for a fee. FinCEN’s system is designed for business owners to handle directly, avoiding extra costs.
Penalties for Non-Compliance
Penalties for failing to comply can reach up to $500 per day and may include criminal charges. Ensure your organization meets the requirements to avoid these consequences.
CTA Purpose
The CTA aims to prevent the misuse of shell companies by creating a private database of beneficial owners, accessible only to government agencies.
For more detailed guidance, you can consult FinCEN’s Compliance Guide and resources for small entities available here.
If you need recommendations for attorneys experienced with BOIR requirements, please let us know.
Contact Information
If you or your family members have any questions about how immigration and nationality laws in the United States may affect you, or if you want to access additional information about immigration and nationality laws in the United States or Canada, please do not hesitate to contact the immigration and nationality lawyers at NPZ Law Group. You can reach us by emailing info@visaserve.com or by calling us at 551-276-1864 extension 104. We also invite you to visit our website at www.visaserve.com for more information.