New federal requirements started January 1, 2024.
Beneficial Ownership Information (BOI) filing. Mandatory for most businesses. Most founders don’t know about it.
You need to know about this.
The Corporate Transparency Act requires most LLCs and corporations to report who owns and controls them. The requirements are new. The penalties are severe.
This guide explains what changed.
What the new rule requires. Who it affects. When you must file. What happens if you don’t. What to do right now.
Read this. Understand the requirements. Take action. Stay compliant.
Key Takeaways
- The Corporate Transparency Act created new BOI filing requirements that started January 1, 2024—most LLCs and corporations must now report beneficial ownership to FinCEN
- Businesses formed before 2024 have until January 1, 2025 to file their initial BOI report, while businesses formed in 2024 or later must file within 90 days of formation
- BOI filing requires identifying beneficial owners—individuals who own 25% or more of the company or exercise substantial control over it
- Penalties for non-compliance are severe: up to $500 per day in civil penalties plus potential criminal penalties up to $10,000 and 2 years in prison
- The filing is free and done online through FinCEN's secure portal—most businesses can complete it in 15-30 minutes with the right information ready
Table of Contents
What Changed in 2024
January 1, 2024 marked the start of new federal reporting requirements.
What happened:
- The Corporate Transparency Act went into effect
- Most businesses must now report beneficial ownership
- New filing requirements started
- Penalties for non-compliance began
Why it matters:
- This is a new requirement
- Most business owners don’t know about it
- Compliance is mandatory
- Penalties are severe
The reality: If you formed an LLC or corporation, you likely must file BOI. The requirement is new. The deadline is approaching.
The Corporate Transparency Act
The Corporate Transparency Act (CTA) is the law behind BOI requirements.
What it is: Federal legislation passed in 2021 that requires businesses to report beneficial ownership information to FinCEN.
Purpose:
- Combat money laundering
- Prevent terrorism financing
- Stop other illegal financial activities
- Increase corporate transparency
Who enforces it: Financial Crimes Enforcement Network (FinCEN), a bureau of the U.S. Department of the Treasury.
When it started: January 1, 2024.
The requirement: Most businesses formed in the United States must file BOI reports identifying who owns and controls them.
Pro tip: This is federal law. Compliance is mandatory. There’s no way around it for most businesses.
Who Must Comply
Most businesses formed in the United States must comply with BOI requirements.
Businesses That Must File
Domestic reporting companies:
- LLCs formed in any U.S. state
- Corporations formed in any U.S. state
- Other entities created by filing with a Secretary of State
Foreign reporting companies:
- LLCs and corporations formed outside the U.S. but registered to do business in the U.S.
The rule: If you filed formation documents with a state, you likely must file BOI.
Exemptions
Large operating companies:
- 20 or more full-time employees in the U.S.
- $5 million or more in gross receipts or sales
- Physical office in the U.S.
Other exempt entities:
- Publicly traded companies
- Banks and credit unions
- Securities brokers and dealers
- Investment companies and advisors
- Insurance companies
- Public accounting firms
- Tax-exempt entities
- Inactive entities
The reality: Most small businesses are NOT exempt. If you’re unsure, assume you must file.
Pro tip: Exemptions are narrow. Most LLCs and corporations formed by small business owners must file BOI. When in doubt, file.
Filing Deadlines
Filing deadlines depend on when your business was formed.
Businesses Formed Before 2024
Deadline: January 1, 2025
What this means: If you formed your business before January 1, 2024, you have until January 1, 2025 to file your initial BOI report.
Example: If you formed your LLC in 2020, you must file by January 1, 2025.
Action required: File your initial BOI report before the deadline.
Businesses Formed in 2024 or Later
Deadline: Within 90 days of formation
What this means: If you form your business on or after January 1, 2024, you must file your initial BOI report within 90 days of receiving notice that your formation is effective.
Example: If you form your LLC on March 1, 2024, you must file by May 30, 2024 (90 days later).
Action required: File your initial BOI report within 90 days of formation.
Updated Reports
When to update: You must file an updated report within 30 days if:
- Beneficial ownership changes
- Company information changes (name, address, etc.)
The rule: Keep your BOI information current. File updates promptly.
Pro tip: Mark your calendar. Set reminders. Missing deadlines results in penalties. Don’t wait until the last minute.
What You Must Report
BOI filing requires specific information about your business and its beneficial owners.
Company Information
What you must report:
- Full legal name of the company
- Any trade names or DBAs
- Complete business address
- State or jurisdiction of formation
- Taxpayer Identification Number (EIN)
Why it matters: This identifies your business in the FinCEN database.
Beneficial Owner Information
Who is a beneficial owner:
- Anyone who owns 25% or more of the company
- Anyone who exercises substantial control over the company
What information is required for each beneficial owner:
- Full legal name
- Date of birth
- Complete residential address
- Unique identifying number (from driver’s license, passport, or other government-issued ID)
- Image of the identifying document
Why it matters: FinCEN needs to identify who actually owns and controls your business.
Company Applicant Information
Who is a company applicant:
- The individual who files the formation documents
- The individual who directs or controls the filing
What information is required:
- Same information as beneficial owners (name, date of birth, address, ID number, document image)
Note: Company applicant information is only required for businesses formed on or after January 1, 2024.
Pro tip: Gather all required information before starting the filing. You’ll need ID documents for all beneficial owners and company applicants.
Penalties for Non-Compliance
Penalties for failing to file BOI are severe.
Civil Penalties
What you face:
- Up to $500 per day for each day the filing is late
- Penalties continue until you file
Example: If you’re 30 days late, you could face up to $15,000 in penalties (30 days × $500).
The reality: Penalties add up quickly. Don’t delay filing.
Criminal Penalties
What you face:
- Up to $10,000 in fines
- Up to 2 years in prison
When they apply: For willful violations, including:
- Willfully failing to file
- Willfully providing false information
- Willfully failing to update information
The reality: Criminal penalties are serious. File accurately and on time.
How to Avoid Penalties
What to do:
- File on time
- File accurately
- Update information promptly when it changes
- Keep records of your filing
Why it matters: Compliance is simple. Non-compliance is costly.
Pro tip: The best way to avoid penalties is to file on time and accurately. Set reminders. Don’t wait.
Immediate Actions to Take
Here’s what you need to do right now:
Step 1: Determine If You Must File
What to do:
- Review your business formation documents
- Determine if you’re a reporting company
- Check if you qualify for any exemptions
Action: Most LLCs and corporations must file. If you’re unsure, assume you must file.
Step 2: Gather Required Information
What to do:
- Collect company information (name, address, EIN)
- Identify all beneficial owners
- Gather ID documents for beneficial owners
- Identify company applicants (if formed in 2024 or later)
Action: Prepare everything before starting the filing.
Step 3: Mark Your Deadline
What to do:
- Determine your filing deadline
- Mark it on your calendar
- Set multiple reminders
Action: Don’t wait until the last minute. File early.
Step 4: File Your BOI Report
What to do:
- Access FinCEN’s BOI e-filing system
- Complete the filing with accurate information
- Submit the report
- Save your confirmation
Action: File as soon as you have all required information.
Pro tip: The filing is free and takes 15-30 minutes. There’s no reason to delay. File now.
Your Next Steps
Understand the requirements. Take action. Stay compliant.
This Week:
- Determine if you must file BOI
- Gather all required information
- Mark your filing deadline
- Set reminders for your deadline
This Month:
- File your BOI report through FinCEN’s portal
- Save your confirmation
- Set up systems to track changes that require updates
- File updates promptly when information changes
Going Forward:
- Keep BOI information current
- File updates within 30 days of changes
- Maintain records of your filings
- Stay compliant with all requirements
Need help? Check out our BOI 101 guide for detailed filing requirements, our compliance dashboard guide for tracking deadlines, and our state-by-state checklist for formation requirements.
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Sources & Additional Information
This guide explains general BOI filing requirements. Specific requirements and deadlines may vary. Always verify current requirements with FinCEN.
For BOI filing, visit the FinCEN BOI website.
For detailed BOI filing information, see our BOI 101 guide.
For compliance tracking systems, see our Compliance Dashboard guide.
