Beneficial Ownership

Overview

As of January 1, 2024, many companies in the United States will have to report directly to the Financial Crimes Enforcement Network (FinCEN) information about their beneficial owners (the individuals who ultimately own or control the company).

Below are the key points and Frequently Asked Questions (FAQs) published by FinCEN on January 12, 2024. The best tool available to help our business clients understand their beneficial ownership reporting requirement is through FinCEN’s website: Beneficial Ownership Information Reporting. Additionally, FinCEN has published the BOI Small Entity Compliance Guide to help facilitate answering client questions and other information pertaining to their reporting responsibilities.

What you need to know about Beneficial Ownership

  • The Beneficial Ownership Information Reporting Rule, created by the Corporate Transparency Act, requires reporting companies to report information about their beneficial owners and company applicants to FinCEN.
  • A beneficial owner is an individual who owns or controls at least 25% of a company or has substantial control over the company. A company applicant is an individual who directly files or is primarily responsible for the filing of the document that creates or registers the company. Reporting became effective January 1, 2024.
  • If an entity was created BEFORE January 1, 2024, the reporting must be completed by December 31, 2024. If an entity is created ON or AFTER January 1, 2024, the reporting must be completed within 90 days of the company creation.

What information must be reported?

  • Reporting Company - full legal name, trade name(s), physical address, EIN for the company
  • Beneficial Owner/Company Applicant - full legal name, date of birth, physical address, copy of non-expired government issued ID

Frequently Asked Questions:

What is the Beneficial Ownership Information Reporting Rule?

The Beneficial Ownership Information Reporting Rule, created by the Corporate Transparency Act, requires reporting companies to report information about their beneficial owners and company applicants to FinCEN. A beneficial owner is an individual who owns or controls at least 25% of a company or has substantial control over the company. A company applicant is an individual who directly files or is primarily responsible for the filing of the document that creates or registers the company. Reporting became effective January 1, 2024.

Who must report?

Unless specifically exempt from the rule, if your company is:

  • a corporation, LLC, or was otherwise created in the United States by filing a document with the secretary of state or similar office under the law of a state or Indian Tribe; or
  • a foreign company and was registered to do business in any U.S. state or Indian tribe by such filing, you must file beneficial ownership information with FinCEN. A company required to report beneficial ownership information to FinCEN is referred to as a reporting company.

When do I need to report my company's beneficial ownership information to FinCEN?

  • A reporting company created or registered to do business before January 1, 2024, will have until January 1, 2025, to file its initial beneficial ownership information report.
  • A reporting company created or registered on or after January 1, 2024, and before January 1, 2025, will have 90 calendar days after receiving notice of the company’s creation or registration to file its initial BOI report. This 90-calendar day deadline runs from the time the company receives actual notice that its creation or registration is effective, or after a secretary of state or similar office first provides public notice of its creation or registration, whichever is earlier.
  • Reporting companies created or registered on or after January 1, 2025, will have 30 calendar days from actual or public notice that the company’s creation or registration is effective to file their initial BOI reports with FinCEN.
  • (a) FinCEN’s Beneficial Ownership Information Reporting Rule for reporting companies and
  • (b) FinCEN’s Customer Due Diligence Rule and Beneficial Ownership for Legal Entity Customer Rule which are applicable to banks.

Despite reporting companies filing BOI with FinCEN, banks must still identify and verify the identity of any individual who owns 25% or more of a legal entity, and an individual who controls the legal entity. Banks are also required to continue their risk assessment and ongoing oversight efforts under their customer due diligence policy and procedures.

Is the information reported by a reporting company the same as what a bank collects under its beneficial owner rule?

No, the rules are not identical.

Are all entities required to file with FinCEN?

No. There are twenty-three specific types of entities that are exempt from the reporting requirements of the rule. The Small Entity Compliance Guide contains a section to help customers determine if they are exempt.

Is there a fee for submitting a BOI information report to FinCEN?

No. There will be no fee for submitting your beneficial ownership information report to FinCEN.

How will I report my company's beneficial ownership information?

If you are required to report your company’s beneficial ownership information to FinCEN, you will do so electronically through a secure filing system available via FinCEN’s website.

Where can I find the form to report?

The form to report beneficial ownership information is posted on FinCEN’s beneficial ownership information webpage and can be found here: https://www.fincen.gov/boi

Where should business customers be referred to for more information about the BOI reporting rule?

FinCEN has a dedicated webpage for its Beneficial Ownership Information Reporting Rule. FinCEN’s website includes a compliance guide, checklists, and informational videos about the rule. The website is also where reporting companies will file their required data: Beneficial Ownership Information Reporting.

If you have any questions, please call 217-285-5585 or stop by one of our locations to visit with a Personal Banker.