19 Dec Corporate Transparency Act and Beneficial Owner Report FAQs
Frequently Asked Questions – Corporate Transparency Act and Beneficial Owner Reports (Updated December 2023)
Please note: this is general information about the Corporate Transparency Act and the Beneficial Owner Reports, and should not in any way be taken as legal advice. Always consult your attorney before responding to an inquiry for business and personal information.
- What the actual F is even going on here? Why do I need to report all this information about myself all of the sudden?
Whoa, calm down. You can thank the shenanigans of corporate America, and an overly complicated tax code for this one.
The US Financial Crimes Enforcement Network (FinCEN) has been tasked with cutting down on shell companies and tax evasion in an effort to increase the transparency of who is doing business in this country and to what degree.
FinCEN needs you to do your part. A one-time filing ( called a “Beneficial Owner Report”) will be required for virtually all LLCs and corporations. It’s a fairly straightforward procedure, but compliance is obligatory, and as you may guess, there are substantial financial and criminal fines in store for defectors.
- Ok, ok, sorry about that. I”m scared. This is my first time doing this, what is involved?
It’s ok to be scared. It’s going to be ok. It’s everyone’s first time. It’s brand new. We are all learning what’s involved together. Come, take our hand, and we will walk. There we will find that we need to report the following information to FinCEN for each company:
- Name of company
- State of formation/incorporation
- Date of formation/incorporation
And this information for each beneficial owner:
- Full legal name
- Residential or business address
- Date of birth
- Driver’s license or passport number, or FinCEN identifier.
- Seems doable. But, what is a Beneficial Owner?
A beneficial owner includes any individual who, directly or indirectly, either exercises substantial control over a reporting company, or owns or controls at least 25% of the ownership interests.
- Why is the Beneficial Owner Report important?
It’s not just important, it’s required. Do not ignore this report – it comes with hefty fines and prison time. This is the federal government’s way of ensuring it knows who owns and controls each company.
- Yikes. Sounds serious. When is the deadline to submit the Beneficial Owner Reports?
If your company was formed before Jan 1, 2024, then you need to report by Dec 31 2024. If your company is formed after jan 1, 2024, then you have 90 days to file the report.
- What happens if I miss the deadline? What if I lie?
Our deep analysis on these questions results in a recommendation not to do either of these.
If you miss your deadline, you will be fined a daily penalty of $100. If you knowingly provide false information, you are looking at jail time in addition to fines.
- Does Opticliff Law help with these reports?
Yes, we will do your report for you if you hire us. We charge $150 for the first beneficial owner, plus $50 for each additional beneficial owner. Simply fill out this form to get started.
- Can I file my own Beneficial Owner Report?
Yes, you can file your own report.
- More questions?
You can find FINCen’s full list of FAQ answers here: fincen.gov/boi-faqs
Or you can book an appointment with one of our lawyers here: opticliff.com/schedule
Godspeed and we are here if you need us!
