BOI 101: Who Must File, By When, and How to Avoid $500/Day Penalties

New federal requirements started in 2024.

Beneficial Ownership Information (BOI) filing. Mandatory for most businesses. $500 per day penalties for non-compliance.

Most business owners don’t know about this.

They formed their LLC or corporation. They think they’re done. They’re not. They must file BOI. They face penalties if they don’t.

This guide explains everything.

Who must file. When to file. What to file. How to avoid penalties. What happens if you don’t file.

Read this. Understand the requirements. File on time. Avoid penalties.

What Is BOI Filing?

Beneficial Ownership Information (BOI) filing is a new federal requirement.

What it is: A report filed with the Financial Crimes Enforcement Network (FinCEN) identifying who owns and controls your business.

Why it exists: The Corporate Transparency Act requires businesses to report beneficial ownership to combat money laundering, terrorism financing, and other illegal activities.

Who enforces it: FinCEN, a bureau of the U.S. Department of the Treasury.

When it started: January 1, 2024.

The requirement: Most businesses must file BOI. There are exemptions, but most LLCs and corporations must comply.

The penalty: Up to $500 per day for each day the filing is late, plus potential criminal penalties.

Who Must File

Most businesses formed in the United States must file BOI.

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.

Who Doesn’t Need to File

Exempt entities include:

• Large operating companies (20+ employees, $5M+ in gross receipts, physical office in U.S.)
• 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 (no assets, no income, no operations)

The rule: Most small businesses are NOT exempt. If you’re unsure, assume you must file.

Pro tip: Most LLCs and corporations formed by small business owners must file BOI. Exemptions are narrow. When in doubt, file.

When to File

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.

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).

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 Information Is Required

BOI filing requires specific information about your business and its beneficial owners.

Company Information

What you need:

• 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.

How to File

BOI filing is done online through FinCEN’s secure portal.

Filing Process

Step 1: Access the portal

• Go to FinCEN’s BOI e-filing system
• Create an account or log in

Step 2: Enter company information

• Provide your business name, address, and formation details
• Enter your EIN

Step 3: Enter beneficial owner information

• For each beneficial owner, provide:
  • Name, date of birth, address
  • ID number and document image

Step 4: Enter company applicant information (if required)

• For businesses formed in 2024 or later
• Provide same information as beneficial owners

Step 5: Review and submit

• Review all information for accuracy
• Submit the filing
• Save your confirmation

Time required: 15-30 minutes for most businesses

Cost: Free

Pro tip: The filing is straightforward if you have all information ready. Prepare everything before starting.

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.

Exemptions and Exceptions

Some businesses are exempt from BOI filing requirements.

Large Operating Companies

Exemption criteria:

• 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.

Why it matters: Most small businesses don’t meet these criteria. Most must file.

Other Exemptions

Exempt entities include:

• 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 rule: Exemptions are narrow. Most small businesses must file.

Pro tip: If you’re unsure whether you’re exempt, assume you must file. It’s better to file unnecessarily than to face penalties for non-compliance.

Your Next Steps

Understand the requirements. File on time. Avoid penalties.

This Week:

1. Determine if you must file BOI
2. Gather required information (company info, beneficial owner info, ID documents)
3. Mark your filing deadline on your calendar
4. Set reminders for your deadline

This Month:

1. File your BOI report through FinCEN’s portal
2. Save your confirmation
3. Set up systems to track changes that require updates
4. File updates promptly when information changes

Going Forward:

1. Keep BOI information current
2. File updates within 30 days of changes
3. Maintain records of your filings
4. Stay compliant with all requirements

Need help? Check out our state-by-state checklist for formation requirements, our compliance dashboard guide for tracking deadlines, and our registered agent guide for business address requirements.

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