Navigating the Corporate Transparency Act: Key Facts About BOI Reporting

Let’s be honest. No one gets into business because they love paperwork. But if you’re a small business owner, you know that paperwork is a necessary evil. And now, thanks to the Corporate Transparency Act (CTA), there’s a new form to add to your “to-do” list: the Beneficial Ownership Information (BOI) report.

Don’t worry – we’re here to help. This isn’t as bad as it sounds, and with a trusted CPA firm like G&S Accountancy, you can be confident you’ll meet all your new reporting requirements without losing sleep.

What Exactly is BOI Reporting?

Let’s get this straight: BOI reporting isn’t just a suggestion – it’s the law. Passed as part of the Corporate Transparency Act (CTA), the U.S. government wants to know who’s really behind businesses operating within its borders. This is part of a larger effort to crack down on things like money laundering, tax evasion, and other shady business dealings. (Sorry, mob bosses and tax dodgers – your days are numbered.)

But for the rest of us honest folks, it means that if you run a small business, you’ll need to file this BOI report to tell the government who your beneficial owners are – in other words, who owns or controls at least 25% of your business. It’s all about transparency.

Does My Business Really Need to File?

The short answer: Probably.

If your business is an LLC, corporation, or any other entity created by filing documents with a state, you need to file a BOI report. There are a few exemptions (we’re talking huge publicly traded companies, major financial institutions, and certain large entities), but most small businesses will need to comply.

Now here’s the catch: if your business existed before January 1, 2024, you’ve got until January 1, 2025 to file your first report. If you started your business after January 1, 2024, you have 90 days from the day you were officially formed to get that BOI report filed .

Feeling overwhelmed yet? Take a breath. We’ve got you.

What Do You Have to Report?

The BOI report requires you to dish out some details about your business and its owners. Here’s what you’ll need:

• Full legal name of the business and any trade names (AKA “doing business as” names)
• The name, date of birth, and residential address of all beneficial owners (that’s anyone who owns 25% or more of the business or has substantial control)
• Identification information for these beneficial owners, such as a passport or driver’s license number .

Sounds pretty straightforward, right? Well, maybe not for everyone, which is where we come in.

What About Dissolved or Disregarded Entities?

Now here’s where it gets tricky: even businesses that no longer exist or are “disregarded entities” for tax purposes might still have to file. If your business was dissolved before January 1, 2024, you’re off the hook. But if your company hung around until after that date – even if it’s dissolved now – you’re still required to file .

And for you disregarded entities out there (hello, single-member LLCs!), if your business fits the criteria of a reporting company, you’ll also need to file. The good news? You can use the taxpayer identification number (TIN) of the owner to get the job done .

How Often Do You Have to File This Thing?

So, you’ve filed your BOI report. Is that it? Unfortunately, no. This isn’t a “set it and forget it” situation. Here’s what you need to know:

• Initial Filing: If you’re in business before January 1, 2024, your initial filing is due by January 1, 2025. If your business was formed after that, you’ve got 90 days from formation to file .
• Updates: Anytime there’s a change in your beneficial ownership – maybe someone sells their stake, or you change your business structure – you need to update your BOI report within 30 days of the change . This includes updates if someone gets a new passport or changes their legal name .
• No Annual Filing: Here’s the good news – you don’t have to file a BOI report every year like your taxes. Just keep it updated when changes happen .

Penalties: Don’t Procrastinate on This One

If you’re one of those people who loves waiting until the last minute, here’s why that might not be a great idea: the penalties for not filing or updating your BOI report are hefty. We’re talking up to $591 per day in fines, and if the government thinks you’re willfully dodging this, you could face up to $10,000 in fines or even two years in prison . Yikes!

How G&S Accountancy Can Help

Feeling lost in a sea of acronyms and deadlines? This is where we swoop in to save the day.

At G&S Accountancy, we specialize in helping small businesses with all their compliance needs. Whether you’re just starting out, running a disregarded entity, or simply unsure if your dissolved business still needs to file – we’ve got you covered.

Here’s how we can help:

1. Determine if Your Business Needs to File: We’ll assess whether your business is required to file a BOI report or if you qualify for an exemption.
2. Complete the BOI Report for You: Leave the paperwork to us. We’ll make sure everything’s filled out correctly and submitted on time, so you avoid penalties and fines.
3. Ongoing Support: Any changes in your ownership? No problem. We’ll handle the updates for you, so you can focus on what you do best – running your business.
4. Peace of Mind: With the potential penalties for non-compliance, let us take the stress off your shoulders. You don’t need to tackle this alone.

Let’s Make This Easy

Don’t get caught off guard by the Corporate Transparency Act. Let G&S Accountancy be your trusted partner for BOI reporting and compliance. Give us a call today, and let’s keep your business on the right side of the law – no fines, no stress, no problem.