New Beneficial Owner Information Reporting Requirements for LLCs

by | Apr 4, 2024

If your business is an LLC in the U.S., you probably are subject to the new Financial Crimes Enforcement Network (FinCEN) rules and will have to file a form. The recent implementation of FinCEN’s Beneficial Owner Information Reporting Requirement may seem daunting at first, but luckily it’s a one-time thing. Let’s explore what this requirement means for small businesses and how you can ensure compliance.

Understanding the Requirement

The Beneficial Owner Information Reporting Requirement mandates that covered entities, including small businesses structured as corporations, LLCs, or other legal entities, must report information about their beneficial owners to FinCEN. If youre business is a sole proprietorship (often referred to as a DBA), you do not have to file. Most dog training businesses, if they are not sole proprietors, are an LLC.  LLCs do need to file.

Beneficial owners are individuals who directly or indirectly own 25% or more of the equity interests in the business or exercise substantial control over its operations. Most likely, if you are dog trainer reading this,  your LLC is owned by you, or maybe one other person; and those are the only “beneficial owners”.

Steps to Compliance

1. Identify Beneficial Owners:

Start by identifying individuals who meet the criteria of beneficial owners according to FinCEN’s definition. This includes anyone who owns 25% or more of your business or holds significant decision-making power.

2. Collect Required Information:

Once you’ve identified the beneficial owners, collect the necessary information such as their full legal name, date of birth, residential address, and a unique identifying number from an acceptable identification document (e.g., driver’s license or passport).

3. Update Internal Records:

Ensure that your internal records accurately reflect the beneficial ownership structure of your business. This information should be readily accessible and kept up-to-date to facilitate reporting as needed.

4. File Required Reports:

File the necessary reports with FinCEN in accordance with the prescribed deadlines. There is a helpful website, and the filing can be done online. If your LLC was formed before 2024, you have some time to file the report. New LLCs must file the report within 90 days of formation.

Filling out and filing the Beneficial Owner Information Report (BOIR)

Gather your information for each Beneficial Owner (anyone who owns 25% or has substantial control of the LLC business):

  • Full Name (including middle name)
  • Date of Birth
  • Address
  • Picture of ID, like a driver’s license (make sure it is smaller than 4mb)
  • The Tax ID number of the LLC

Once you have all the info gathered, fill out the form and file it online:

  1. Go to fincen.gov/boi or search “Beneficial ownership information” to find the FinCen website
  2. Click “File: File a report using the BOI E-Filing System”
  3. Click “File a BOIR: Need to file a BOIR? Click here!”
  4. Either download the PDF or use the online filing method. I used the PDF method.
  5. Begin filling in the required fields. The form automatically greys out any fields you are not required to answer, based on your prior answers
  6. The “Company Applicant” is the person filling out the form
  7. Fill in the owner’s information. Click the plus symbol (+) at the top to add another owner
  8. Scroll back to the top and click trhough the grey buttons at the top left: Validate, Finalize, Save, Print (only if you want a paper copy) and File
  9. Fill in fields online and upload the saved form

Seek Professional Guidance:

If you’re unsure about how to interpret or comply with the Beneficial Owner Information Reporting Requirement, consider seeking guidance from legal or financial professionals with expertise in regulatory compliance. They can help clarify any uncertainties and ensure that you’re taking the necessary steps to comply.

Conclusion

Complying with FinCEN’s Beneficial Owner Information Reporting Requirement may require time and effort, but it’s important to be sure your small business is complying with all legal requirements. By following these steps you can navigate the reporting requirements effectively while focusing on growing your business. Remember, staying proactive and informed is key to ensuring ongoing compliance with regulatory obligations.

1 Comment

  1. ROBIN ASHMAN-TERRELL

    Thank you so much for this information. I was able to do this myself thus saving me $149.00 for someone else to file it for me. And I could not find the information if this was required every year and you answered that question. This was so helpful!!

    Reply

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