Secure Compliance Helps Professionals Navigate FinCEN Beneficial Ownership Reporting

The United States Corporate Transparency Act (CTA) represents a watershed moment in an era of increased regulatory scrutiny of business ownership structures. Signed into law on January 1, 2021, the CTA is aimed at enhancing financial transparency by unraveling complex business ownership structures for law enforcement and financial regulators. As a part of the National Defense Authorization Act, the CTA represents a vital step in the fight against financial crime, money laundering, and illicit financial activities. The CTA casts a wide net with an estimated 32.6 million entities in the U.S. required to file during 2024, with only around 11.1% of entities meeting the requirements for one of twenty-three available exemptions. 

The primary goal of the CTA is to enhance corporate transparency by requiring certain entities, called reporting companies, to disclose information about their beneficial owners to the Financial Crimes Enforcement Network (FinCEN), a bureau of the U.S. Department of the Treasury. This beneficial ownership information (BOI) reporting requirement began January 1, 2024. 

How Does this Affect Your Company?

Reporting Companies 
If your company is an LLC, corporation, partnership, or similar entity that was created by filing a document with a secretary of state or tribal body, then you are required to file a beneficial ownership information report. Most formal business structures fall within this mandate. 

Beneficial Ownership Disclosure 
As a corporation, LLC, partnership, or other business entity (domestic and foreign), you must report detailed information about beneficial owners. These are individuals who directly or indirectly control 25% or more of ownership interests or have substantial ability to control business decisions. 

Company Applicant Disclosure 
If your entity was created January 1, 2024 or later, your company will also need to report company applicants. These are individuals who (i) directly submitted the document responsible for establishing or initially registering the reporting company and/or (ii) were chiefly accountable for guiding or managing the submission of the legal document. No more than two company applicants are to be reported. 

Beneficial Ownership Filing Deadlines
If your company was formed: 

• Prior to January 1, 2024 – the due date for filing is December 31, 2024
• In 2024 – you must file within 90 days from when you filed formation documents
• In 2025 or beyond – your new company must file within 30 days of formation. 

Once your company’s BOI report is filed with FinCEN, it is not necessary to file annually; however, if any of the information changes, updates must be reported within 30 days. 

CTA Enforcement and Penalties 
The CTA imposes substantial penalties for non-compliance and willful provision of false information. Entities that fail to report accurate beneficial ownership information may face significant criminal and civil penalties of $591/day or up to $10,000 in fines or 2 years of imprisonment. 

How to File: Streamline Beneficial Ownership Reporting with Simple Software 

Secure Compliance, LLC, a US-owned and run company, saw a need to streamline FinCEN Beneficial Ownership Information (BOI) reporting for professionals and business owners by leveraging cutting-edge technology. Through a secure, scalable cloud interface, the company crafted an innovative, time-saving software solution, ensuring an efficient experience for CPAs, attorneys, and others who utilize the company’s patent-pending software: SecurePRO™ and SecureFILE™. 

Stacy Kuxhausen, Chief Sales and Marketing Officer and CPA, explains: “Our goal was to streamline the process, not make it more complicated. We are business owners too, so we understand that filing BOI reports is just one more daunting task, and the penalties for delaying are harsh. That’s why we created intuitive BOI-specific software geared to professionals and business owners to make reporting fast, easy, and secure. Utilizing SecurePRO and SecureFILE, business owners can be confident they are FinCEN compliant now and in the future.” 

To learn more about Secure Compliance’s software solutions, visit the website or contact the Secure Compliance team today.