As a small business owner, you’re already juggling a range of regulations, but there’s one that demands your immediate attention: Beneficial Ownership Information (BOI) reporting. Required by the Financial Crimes Enforcement Network (FinCEN), this regulation mandates that most U.S. businesses disclose details about their beneficial owners.
For many, this might feel like another bureaucratic hurdle, but the consequences of non-compliance are too serious to ignore. Let’s break down why BOI reporting matters for your business and how you can ensure compliance without getting overwhelmed.
BOI reporting is part of the Corporate Transparency Act (CTA), designed to combat illegal activities like money laundering and tax evasion by increasing corporate transparency.
Essentially, it requires businesses to report information about individuals who own or control at least 25% of the company. This includes their full name, residential address, date of birth, and more. While this may sound simple, the process can be challenging for small business owners due to the complex requirements and strict reporting deadlines.
Although BOI reporting might seem like a routine requirement, navigating FinCEN’s intricate requirements set is far from straightforward. FinCEN provides a 60-page guide for filing these reports, but it’s time-consuming for the average business owner to undertake, and there is a margin of risk of errors.
Moreover, over 99% of small businesses—such as LLCs, corporations, and other entities—are required to file BOI reports, as very few meet the exemption criteria. Non-compliance isn’t an option. BOI reporting is a legal obligation, and ignoring it can lead to serious repercussions.
Filing your BOI report isn’t a “set it and forget it” task. Once filed, you are responsible for keeping the information current.
Any changes in beneficial ownership—such as a new owner or changes to an owner’s address—must be reported to FinCEN within 30 days. However, FinCEN does not send reminders for these updates, making it easy to miss deadlines, which can result in costly penalties.
The penalties for failing to meet BOI reporting requirements are steep. Per FinCEN's website at time of publishing, "A person who willfully violates beneficial ownership reporting requirements may be subject to civil penalties of up to $591 for each day that the violation continues, as well as criminal penalties of up to two years imprisonment and a fine of up to $10,000. Potential violations include willfully failing to file a beneficial ownership information report, willfully filing false beneficial ownership information, or willfully failing to correct or update previously reported beneficial ownership information."
At Profitwise Accounting, we understand the complexities of BOI reporting and how overwhelming it can be for small business owners. Our team stays ahead of the curve, thoroughly researching the Corporate Transparency Act and its implications for businesses like yours.
That is why our service isn’t about the paperwork. We handle the entire BOI process starting with a detailed analysis of your entity’s filing requirements, confirmation of Beneficial Owner eligibility, registration of a FinCEN filing number for your entity as well as all Beneficial Owners. Then, we ensure the initial filing of your BOI with FinCEN is accurate, and on time, helping you stay compliant without added stress.
Our services don’t stop with the initial filing of your BOI reports. We will then proactively support your compliance, with quarterly outreach to identify structural changes that may mandate updates, provide as-needed consultation around these triggers, and file all updated reports to make sure you remain compliant..
With Profitwise Accounting, you’re not just hiring an accountant—you’re gaining a trusted partner dedicated to protecting your business from the risks of non-compliance.
BOI reporting is a critical legal requirement that business owners must take seriously. While the process can be complex, the right support can make it much more manageable. Our team at Profitwise Accounting is here to guide you through the BOI reporting process and keep your business protected.
Don’t wait until it's too late. Contact us today to learn how we can help you meet your BOI reporting obligations and protect your business from unnecessary risks.