WTL…? What's That Lawyer Saying? BOOR? BORE? BOIR? It's BOIR!Small Business Owners missed or missing a federal law deadline? Get After It!

By Jonathan K. Hustis and Joe Garza, Jr.

That lawyer is saying: BOIR, or Beneficial Ownership Information Report, a federally required filing for many small businesses, whether new or old. There are civil and criminal fines and penalties for failing to comply BOIR. Read the U.S. Department of Treasury's Small Entity Compliance Guide. Here is why you should read the Compliance Guide now.

WHO: Corporations, LLCs, limited partnerships, and foreign companies registered to do business in any U.S. State or Tribal Jurisdiction.

If you own or operate any of these, find out if you must comply. Check the U.S. Department of Treasury's Small Entity Compliance Guide to see: 1) do you have a "reporting company"? and 2) is it exempt or not exempt?

WHAT:  A BOIR, or Beneficial Ownership Information Report, that describes the company, its owners, and applicants involved in the filing of the company's creation or registration documents. There is a handy chart in the Compliance Guide.

WHEN:  It depends, but the initial BOIR must be filed soon:

1. If the entity was created or US-registered on or after January 1, 2024, the deadline is before 90 days expires after the creation/registration date.

2. If the entity was created or US-registered before January 1,  2024, then the Deadline is by (before) January 1, 2025.

3. If the entity is not created or registered until January 1, 2025 or later, then the deadline is 30 days after the creation or registration.

4. Update filings, with their own deadlines, may be required after the initial report. See the Compliance Guide.

   
   

WHERE AND HOW:  Online BOIR Creation or Upload Filing.  

Website.  The Treasury Department's Financial Crimes Enforcement Network (FinCEN) has published a website with directions. It may be easy or hard for you, depending on your willingness to read instructions carefully, understanding the terms involved (remember that Compliance Guide!), and comfort with online transactions generally.

Advisors. Your tax accountant, business law firm, or a dedicated compliance firm can do it for you, for a fee. The advantages of using these professionals are ease to you, accuracy that comes from professional proficiency, and any record-keeping services they also offer.  Lateness or uncorrected mistakes can lead to civil and criminal liability, so ease and proficiency are valuable here. See "WHY" below.

FinCEN ID #s and Private Information. You'll have to gather, input, and submit items of private information from beneficial owners and applicants. In a previous article on the Fulton|Jeang law firm website, we advised readers that getting a federal FinCEN number before the filing is a good idea.  Check it out. Get a FinCEN ID number and encourage your beneficial owners and applicants to do it.

WHY:  For a willful breach, failure to report or update, or willfully providing wrong or incomplete information:

Civil penalties of up to $500 per day.

 Criminal Penalties of up to two years imprisonment and up to $10,000 per violation.

 WHY NOW?  You need to gather information.  It's now 4th quarter 2024. In less than two months you, your beneficial owners and applicants will have gone off to prepare for and enjoy the season's holidays. So, go ahead. Join a crowd of just-in-time filers during the week after Christmas. What are the odds of a FinCEN or BOIR application website breakdown during that week? Who will you call then?

Now seems good, right?

Jonathan K. Hustis and Joe Garza are business lawyers with the Fulton Jeang PLLC law firm in Texas. This article is an alert to readers.  It is not specific legal advice to anyone. Go to the Compliance Guide and other resources, and talk to your legal advisor, accountant, or other trusted advisor. Give them your facts and questions. Get more good advice from them - advice that you will know applies directly to you. Good luck and good results to you!