As financial transparency regulations evolve, small business owners must stay informed about compliance requirements to avoid penalties. The Financial Crimes Enforcement Network (FinCEN) has implemented new Business Ownership Information (BOI) filing requirements, which aim to improve the transparency of business ownership in the U.S. Let's dive into the key details you need to know, including filing deadlines, who must file, exemptions, and ways to protect yourself from scams.

What is the Business Ownership Information Filing?

Introduced under the Corporate Transparency Act (CTA), FinCEN's BOI filing requirements mandate that businesses provide ownership details to a national registry. The goal is to combat financial crimes like money laundering by creating a transparent view of who owns and controls entities operating in the U.S.

Important Filing Deadlines: Don’t Miss Them

Here are the current deadlines for BOI filing:

• Businesses registered before January 1, 2024: Must file by January 1, 2025.

• Businesses registered on or after January 1, 2024: Must file within 30 days of the formation date.

• Updates to BOI reports: If there are any changes to ownership or other required information, updates must be made within 30 days of the change.

Staying ahead of these deadlines is crucial to avoid non-compliance penalties.

Who Needs to File?

This filing requirement is targeting owners of small businesses where the owners own 25% or more of an entity or have significant management responsibility and the entity has less than 20 employees and less than $5 million in revenue. Exemptions are very limited and specific to certain entities.

This brief summary is not a detailed description of filing requirements.  Please consult an expert.

Protect Yourself from BOI Filing Scams

With new filing requirements comes an increase in scams. Fraudsters may reach out, offering to file your BOI report for a fee. They may even request prepayment. Be aware:

• FinCEN does not charge a filing fee or require payment through third parties.

• Avoid providing any payment or personal information to unsolicited contacts claiming to help with BOI filing.

Always verify the legitimacy of any requests related to BOI reporting, and if in doubt, consult a trusted advisor.

How to File Your BOI Report

Filing your report can be straightforward if you follow the steps provided by FinCEN:

1. Gather all necessary information on beneficial owners, including names, addresses, and identification details.

2. File online via FinCEN's BOI Reporting Tool.

3. Update as necessary: If your business ownership changes, you’ll need to update your BOI report within 30 days.

Leveraging QuickBooks and Technology for Compliance

At Peak Advisers, we recognize that keeping up with compliance while managing everyday operations can be challenging. Our expertise with QuickBooks can help streamline your processes, ensuring all ownership information is well-organized and ready for BOI filing. Integrating compliance tasks into your financial management routines minimizes stress and reduces the risk of missing important deadlines.

Next Steps for Small Business Owners

To stay compliant, take these actions:

1. Determine your filing obligations based on your business's formation date and structure.

2. Review FinCEN's updated guidance and FAQ for any new updates.

3. Implement tracking systems for ownership changes to keep your BOI report current.

4. Seek expert advice if you're unsure about the filing process. Peak Advisers can help you navigate these requirements and integrate compliance solutions seamlessly with your existing financial systems.

Final Thoughts

FinCEN’s BOI filing requirements represent a significant shift in business transparency standards. While compliance may seem like a burden, it also presents an opportunity to strengthen your business's commitment to integrity and trust.

Peak Advisers is providing this general information as a courtesy.  We are not providing BOI filing services and are not experts in this new requirement. Please consult your tax preparer, CPA, or attorney.