Nobody starts a business with paperwork as the goal, but if you're a small business owner, you know it comes with the territory. Now, with the Corporate Transparency Act (CTA), there’s a new addition to your to-do list: BOI Reporting.

But don’t stress – we’re here to guide you. Hudson & Empire can help ensure that you meet all your reporting requirements, leaving you with peace of mind and fewer sleepless nights.

What Is BOI Reporting, Anyway?

Here’s the scoop: BOI reporting is mandatory, not optional. Passed as part of the CTA, the government requires BOI reports to uncover the true ownership behind businesses operating in the U.S. This is all part of an effort to reduce criminal activities like money laundering and tax evasion.

So, if you’re a law-abiding business owner, this means filing a BOI report to declare who your beneficial owners are – that’s anyone who holds at least 25% ownership or significant control over your company. In short, it’s all about transparency.

Does My Business Need to File?

In most cases, yes. If your business is an LLC, corporation, or another registered entity, BOI reporting is required. While some large entities like publicly traded companies are exempt, the majority of small businesses must comply.

Here’s the timeline: if your business was created before January 1, 2024, you have until January 1, 2025, to submit your initial report. If your business was established after January 1, 2024, you’ll need to file within 90 days of formation.

What Information Is Needed for the BOI Report?

To complete your BOI report, you’ll need to provide some specific details about your business and its owners, including:

Legal name of your business and any trade names (DBAs)
Names, dates of birth, and residential addresses of all beneficial owners (anyone owning 25% or more, or with substantial control)
Identification info for beneficial owners, such as a passport or driver’s license number

While this may seem straightforward, we understand it can feel overwhelming, which is where we come in to support you.

What About Dissolved or Disregarded Entities?

This is where things get complex. Even if your business is no longer active or is considered a “disregarded entity” for tax purposes, you might still need to file a BOI report. If your business dissolved before January 1, 2024, you’re in the clear. But if it was active after that date, even if it’s now dissolved, you must file.

Single-member LLCs, you’re not off the hook either. If your business meets the reporting criteria, you’ll need to file a BOI report using the owner’s taxpayer identification number (TIN).

How Often Must You File?

Once you’ve filed your initial BOI report, you’ll need to keep it updated. Here’s what you need to know:

Initial Filing: Due by January 1, 2025, for businesses established before January 1, 2024. New businesses must file within 90 days.
Updates: Any changes in ownership or control (e.g., someone sells their stake or updates their passport) require you to update your report within 30 days.
No Annual Filing: Unlike taxes, this report isn’t required yearly. Just update it when changes occur.

Penalties for Non-Compliance

Procrastinators, beware: failing to file or update your BOI report comes with steep penalties. You could face up to $591 in daily fines and, in severe cases, up to $10,000 in fines or two years in prison for deliberate non-compliance.

How Hudson & Empire Can Help

Navigating the BOI reporting requirements can be overwhelming, but Hudson & Empire is here to simplify the process. Here’s how we can assist:

Determine Filing Requirements: We’ll assess if your business needs to file or qualifies for an exemption.
Handle the BOI Report: We’ll complete and submit your BOI report accurately and on time to avoid penalties.
Ongoing Support: If there are ownership changes, we’ll manage updates so you can focus on running your business.
Peace of Mind: With potential fines for non-compliance, let us take the burden off your shoulders.

Frequently Asked Questions:

What is BOI reporting, and why is it required?

BOI reporting is a legal requirement under the Corporate Transparency Act. It mandates that businesses disclose their beneficial owners to increase transparency and prevent illegal activities like money laundering.

Which businesses are exempt from filing a BOI report?

Only certain entities, such as large publicly traded companies and some financial institutions, are exempt. Most small businesses, however, must comply.

What information do I need to provide in a BOI report?

You’ll need the full legal name of your business, names, birthdates, residential addresses of beneficial owners, and identification details like a passport or driver’s license.

What are the penalties for failing to file or update a BOI report?

Penalties include daily fines up to $591 and, for severe non-compliance, potential fines up to $10,000 or two years in prison.

How often do I need to file or update my BOI report?

BOI reporting isn’t annual, but any changes in beneficial ownership must be updated within 30 days. Initial filings are due by January 1, 2025, for businesses formed before 2024, with new entities having a 90-day deadline.

Avoid unnecessary stress and let Hudson & Empire assist with your BOI reporting. Give us a call today, and let’s keep your business in compliance – no worries, no fines, just peace of mind.

BOI Reporting Alert: Key Compliance Facts for the Corporate Transparency Act