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The penalties for BOI reporting violations and for the unauthorized disclosure or use of BOI are each increased to $591 a day from $500, effective Jan. 25. The penalties were established in 2021 when the Corporate Transparency Act (CTA), which mandates BOI reporting, became law in 2021.

Starting January 1, 2024, most United States (U.S.) entities must report information about the beneficial owners of their businesses to strengthen the integrity of the U.S. financial system by making it harder for illicit actors to use shell companies to launder their money or hide assets.

If you miss the BOI report filing deadline, you (and/or your clients) could face serious repercussions, including: Civil Penalties: For each day your report is late, you could be fined up to $591. This daily penalty accumulates quickly, creating a substantial financial burden.

To briefly summarize, companies that ceased to exist as legal entities before January 1, 2024 and foreign companies that ceased to be registered before January 1, 2024 are not required to file a BOI report.

Are some companies exempt from the reporting requirement? Yes, 23 types of entities are exempt from the beneficial ownership information reporting requirements. These entities include publicly traded companies meeting specified requirements, many nonprofits, and certain large operating companies.

A reporting company created or registered to do business before January 1, 2024, will have until January 1, 2025, to file its initial BOI report. A reporting company created or registered in 2024 will have 90 calendar days to file after receiving actual or public notice that its creation or registration is effective.

The penalties for BOI reporting violations and for the unauthorized disclosure or use of BOI are each increased to $591 a day from $500, effective Jan. 25. The penalties were established in 2021 when the Corporate Transparency Act (CTA), which mandates BOI reporting, became law in 2021.

Who needs to report beneficial ownership information? Under the CTA, all reporting companies need to report BOI to FinCEN. Reporting companies are entities created or registered in the U.S. by filing a document with a secretary of state or similar office unless it qualifies for one of 23 exemptions.