As part of our commitment to keeping you informed, we want to make sure you're aware of important updates regarding business filing requirements. Staying compliant with these regulations is essential to avoid penalties and ensure your business remains in good standing.
While Brinker Simpson & Company does not directly manage Beneficial Ownership Information (BOI) filings, we are here to provide you with the necessary resources and information to help you comply with these critical regulations.
Generally speaking, most business entities with fewer than 20 full-time employees and less than $5 million in sales or gross receipts documented and reported on federal information forms or tax returns will be required to complete the BOI disclosure.
On September 10, 2024, FinCEN introduced key updates to the BOI reporting requirements. These updates are crucial for ensuring businesses remain compliant with current regulations. The latest guidance, including FinCEN's new FAQs, addresses important questions about reporting obligations, particularly for ceased operations or foreign entities.
Here are some highlights of the changes:
Reporting Requirements for Ceased Companies
In July 2024, FinCEN issued initial updates regarding reporting requirements for ceased companies. On September 10, 2024, additional details were provided to clarify these reporting requirements.
According to the latest updates, any reporting company created or registered in 2024 must file its BOI Report with FinCEN within 90 days of receiving public notice of its creation or registration. For companies established in 2025 or later, the reporting deadline is reduced to 30 days from receiving public notice. This rule applies regardless of how quickly the company ceases operations or undergoes dissolution.
If a company that has filed an initial BOI Report ceases to exist, it is not necessary to file an additional report after dissolution. The initial BOI Report filed prior to the company's dissolution is considered sufficient.
Who Can File a BOI Report for Dissolved Companies?
Under the updated rules, a BOI Report can be filed by anyone authorized by the reporting company. This includes employees, owners, or third-party service providers. Even if the company has ceased to exist, the authorized individual or entity can submit the BOI Report on its behalf.
If a reporting company is set to dissolve before the end of the 30-day or 90-day reporting period, the company needs to make arrangements in advance. These arrangements should ensure that the BOI Report is filed on its behalf before or shortly after its dissolution. The responsibility to ensure timely submission of the report rests with the reporting company while it is still operational.
Reporting Requirements for Foreign Companies
As per the new updates from FinCEN, when foreign companies that have ceased doing business in the United States before January 1, 2024, are exempt from reporting their beneficial ownership information to FinCEN, this exemption holds once these companies have completed the formal and irrevocable process of withdrawing its registration to conduct business in the U.S.
It's important to understand that if a foreign company has fully withdrawn its registration before the specified date, it is no longer subject to any reporting requirements. This is a significant relief for companies looking to exit the U.S. market, allowing them to focus on their operations without the burden of compliance obligations.
However, suppose a foreign company was registered to do business in the U.S. at any point on or after January 1, 2024. In that case, it will still be required to report beneficial ownership information, even if it ceased operations before that date. Therefore, companies must proactively manage their registration status to avoid unnecessary reporting requirements.
Historical Beneficial Owners in Initial Reports
Under the new updates, the initial BOI report must only include the information of the beneficial owners who are part of the company during the filing process. Companies must notify FinCEN of any changes to beneficial owners and related BOI through updated reports.
When a company created or registered in the current tax year 2024 or later ceases to exist before the reporting deadline, the BOI report must contain the correct and accurate beneficial ownership information before the company ceases to exist.
Deadlines to Remember
Existing companies (as of January 1, 2024)
↪️File by January 1, 2025.
New companies (registered between January 1, 2024, and January 1, 2025)
↪️File within 90 days of formation.
New companies (registered after January 1, 2025)
↪️File within 30 days of formation.
🔗 FinCEN Filing Link
🔗 Frequently Asked Questions
How Brinker Simpson Can Help
Remember, while we do not facilitate BOI filings, we are here to keep you informed and provide valuable resources. Don't hesitate to contact our team if you have any questions or need assistance understanding these requirements.
