BOIR Basics
What You Need to Know About the New BOIR Filing Requirement from FinCEN
If you’re a small business owner or entrepreneur, there’s a new filing requirement you’ve probably heard whispers of, and it’s time to get ahead of it. Starting this year (2024), FinCEN (aka the Financial Crimes Enforcement Network) is requiring businesses to file something called the Beneficial Ownership Information Report (BOIR).
What’s the deal? This new rule is all about bringing more transparency to who actually owns and controls businesses in the U.S. If you’re running a side hustle or managing a thriving LLC, you probably need to take action.
Let’s break it down, so you can tackle this with confidence!
What Is the BOIR?
The BOIR is part of the Corporate Transparency Act (CTA), a law aimed at preventing shady practices like money laundering and tax evasion. Basically, the government wants to know who’s making decisions behind the scenes.
Here’s what FinCEN is asking for:
Your business info (name, address, EIN).
Detailed info about your beneficial owners—basically, anyone who owns at least 25% of your business or has significant control. And yes, I mean detailed info: legal names, birthdates, residential addresses, and a government-issued ID number.
Who Has to File?
The good news? Not everyone needs to worry about this. Bad news? If you’re a small business owner, odds are, you do.
Most LLCs, corporations, and similar entities need to file unless they fall under one of 23 exemptions. Here are some examples of who’s off the hook:
Big companies with 20+ employees, over $5 million in revenue, and a U.S. office.
Nonprofits and tax-exempt organizations.
Heavily regulated businesses like banks and insurance firms.
Not sure if your business qualifies for an exemption? Let’s chat, and we’ll help you figure it out.
What’s The Filing Deadline?
Since this is a relatively new filing, the dates are different based on when you started your business.
New businesses formed on or after January 1, 2024: You have 30 days from formation to file.
Existing businesses: You have until January 1, 2025, so if you haven’t filed now, you have just over a month!
How Do You File?
FinCEN’s online portal (boiefiling.fincen.gov) is where ALL the magic happens. It’s a user-friendly system that walks you through the process step by step.
Pro tip: gather all your details ahead of time so you’re not scrambling for your ID or EIN halfway through.
Why Does Filing Matter?
If you don’t file, there are real consequences. Like, expensive consequences. We’re talking:
Fines of $500 per DAY for non-compliance.
Criminal charges: up to $10,000 in fines and even prison time for serious violations.
YIKES, right? Let’s avoid that altogether.
FAQs About BOIR Filing
1. What if I’m a solopreneur or freelancer?
If you operate under a sole proprietorship or general partnership, you’re likely exempt. But if you’ve registered as an LLC or corporation, this rule could apply to you.
2. How do I know if I’m a beneficial owner?
A beneficial owner is anyone who owns at least 25% of the company or who has significant decision-making power. If you’re calling the shots, you probably qualify.
3. What happens if my ownership changes?
You’ll need to update your BOIR within 30 days of any changes, such as selling part of your business or adding a new partner.
4. Is my information public?
Nope! FinCEN keeps your info secure and confidential. It’s only accessible to authorized parties like law enforcement and regulators.
5. Can I DIY this filing?
Absolutely. FinCEN’s portal is designed to make the process simple. But if you’d rather hand it off to a pro (we get it, compliance isn’t fun), we’re here to help!
Prism Consulting Has Your Back
We know compliance isn’t the most exciting part of running a business, but it’s one of the most important. At Prism Consulting, we make it easy to check this off your to-do list and move on to the stuff you actually enjoy.
Whether you need help filing your BOIR, staying on top of deadlines, or figuring out if this even applies to you, we’re here to guide you every step of the way.
📞 Ready to simplify your business life? Contact us today!
