Update, August 2026: FinCEN has permanently ended beneficial ownership information reporting for companies created in the United States. A final rule effective August 14, 2026 exempts U.S. companies and their beneficial owners from BOI reporting under the Corporate Transparency Act. The deadlines and penalties described below no longer apply to domestic reporting companies. See FinCEN's current guidance at https://www.fincen.gov/boi.

The Financial Crimes Enforcement Network (FinCEN) rolled out a significant regulatory measure known as the Beneficial Ownership Information (BOI) reporting requirement.

The purpose of this new law is to help create better transparency in corporate ownership in order to help prevent potential financial crimes such as money laundering and terrorist funding.

In this article, I will provide an outline of this new measure and the potential implications this has for your business.

 

Understanding the FinCEN BOI Reporting Requirement

At its core, this new reporting requirement mandates that certain companies disclose information about their beneficial owners.

Beneficial owners are individuals who have direct or indirect ownership or control over the company.

 

Who is required to file the new report?

Companies required to report are called reporting companies.

The number of companies required to file this report is estimated to be in the tens of millions and are comprised mostly of small and mid-sized businesses. These include both domestic companies and foreign companies registered to do business within the U.S.

According to the BOI Small Business Compliance Guide, there are only 23 entity types that are exempt from this reporting requirement:

  • Securities reporting issuer
  • Governmental authority
  • Bank
  • Credit union
  • Depository institution holding company
  • Money services business
  • Broker or dealer in securities
  • Securities exchange or clearing agency
  • Other Exchange Act registered entity
  • An investment company or investment adviser
  • Venture capital fund adviser
  • Insurance company
  • State-licensed insurance producer
  • Commodity Exchange Act registered entity
  • Accounting firm
  • Public utility
  • Financial market utility
  • Pooled investment vehicle
  • Tax-exempt entity
  • Entity assisting a tax-exempt entity
  • Large operating company
  • Subsidiary of certain exempt entities
  • Inactive entity

Please Note: Even if you see your entity type listed above, it’s imperative that you consult with a qualified professional before determining whether or not your company is required to file.

 

When to file

A reporting company created or registered to do business before January 1, 2024, had until January 1, 2025, to file its initial beneficial ownership information report.

A reporting company created or registered to do business on or after January 1, 2024, had up to 90 calendar days from the time it received its notice of registration to file its initial BOI Report.

For new entities created on or after January 1, 2025, that deadline decreased to 30 days from notice of creation or registration of the entity.

 

What details are required

Reporting companies are required to provide the following information in their report:

  • Personal Details: Detailed information about each beneficial owner, including their full legal name, date of birth, address, and identification number (such as a drivers license or passport number), etc.
  • Entity Information: Legal entity name, trade names (if any), jurisdiction of formation, Tax Payer Identification Number (including EIN), etc.
  • Verification Documentation: Companies must collect and maintain supporting documentation that helps validate the identity of the beneficial owners.

 

Consequences for Non-Compliance

Failure to comply with this new requirement carried significant consequences, including steep fines and personal legal troubles.

Companies who knowingly provided false information (including a false or fraudulent identifying photograph or document) or who neglected to report by the filing deadline could face civil BOI penalties of up to $500 per day, up to $10,000 and/or up to 2 years of imprisonment.

 

Conclusion

The FinCEN BOI reporting requirement presented difficult challenges for many businesses.

This requirement no longer applies to companies created in the United States. If you are unsure whether a filing obligation applies to your business, check FinCEN's current guidance or speak with a tax professional.

This post is to be used for informational purposes only and does not constitute legal, business, or tax advice. Each person should consult his or her own attorney, business advisor, or tax advisor with respect to matters referenced in this post. We assume upon the information contained herein.