Federal Reporting Requirements for Small Businesses: Beneficial Ownership Information

Tens of millions of small businesses must now report. BOIR is targeted at companies with less than twenty full-time employees and less than $5 million in gross revenues. A company must report if they meet the definition of a “reporting company” and do not qualify for an exemption. There are two types of reporting companies: 1) Domestic report company, or 2) Foreign reporting company. And as implied, a company formed in either the U.S. or outside the U.S. might be required to file. Additionally, if the company is a C-Corporation (C-Corp or Corporation), S-Corporation (S-Corp), Limited Liability Company (LLC), or was created by filing paperwork with the Secretary of State (or similar office) under the law of a state or Indian tribe, the BOI must be filed. Sole proprietorships and partnerships do NOT have to file (unless they were formed by filing with the Secretary of State, or similar office, in their state of formation, or Indian Tribe). (Akalp, 2024).

There are numerous types of companies that are exempt from reporting Beneficial Ownership Information (see table below). Carefully review the list before determining that Tax exempt entities are generally not required to report, and this includes nonprofits formed under IRS Code 501(c), political organizations, and trusts formed under IRS Code 4947(a).

A Beneficial Owner is an individual who either directly or indirectly: (1) Has substantial control over a reporting entity; -or- (2) Controls at least 25% ownership of a reporting entity. Note that a Beneficial Owner must be a person. A trust, a corporation, or other business entity cannot be a Beneficial Owner.

What does substantial control mean? It means one or more of the following:

1. A senior oEicer (President, CEO, CFO, or COO);
2. Has authority to hire and fire a senior officer; and/or
3. Is an important decision maker (decisions related to the nature of the business, financial authority, or business structure).

Are there exceptions to the beneficial owner definition? Yes. A few exceptions include:

1. A minor child;
2. A nominee, custodian or agent;
3. An employee, unless they are actually submitting BOIR;
4. A future inheritor (once they inherit, they are not an exception); or
5. Creditors.

If your company has been determined to be a reporting company, the due date for filing the BOIR depends upon when the company was formed. The following table outlines reporting due dates.

What changes trigger an amended filing? The following events all cause a need for an amended BOIR:

1. Changes in the reporting company, name for example;
2. Changes in company ownership or changes in beneficial owners;
3. Changes in beneficial owner’s name, address, or change in identifying documentation (driver’s license number, for example).

Reporting is done electronically through the BOI E-Filing System website. Step by step filing instructions are available online.

• The link above takes you to the FinCEN's BOI E-Filing site.
• Select either the "File BOIR" at the bootom left of the page or "BOI E-FIling GET STARTED" button at the upper right of the page.
• Choose to use the "File Online BOIR" option or the "File PDF BOIR" option. To use the PDF method, your computer needs to have Adobe Reader 8 or higher.

Under “Filing Information” #3, there is an option to request to receive a FinCEN ID number for a beneficial owner or for an applicant. Applying for a FinCEN ID number is completely optional. The advantage of having a FinCEN ID is that you only must enter your information once, then use the FinCEN ID number for future reporting. Step by step filing instructions are available through the 

Required information from the Reporting Company

1. Company’s legal name
2. Any DBA or trade name
3. Current street address of the business
4. Jurisdiction of business formation
5. Tax identification number (EIN, SSN/TIN, or Foreign)

Required information for each Beneficial Owner

1. Individual’s name
2. Date of birth
3. Residential street address
4. ID number from an acceptable document (driver’s license, state ID card, passport, etc.)
5. Upload image of the document used for ID

There can be substantial penalties for nonreporting or reporting false information. Potential violations include willful failing to file a BOIR, willful filing of false information, and willful failure to correct or update previously reported information. Civil penalties are $500 per day and criminal penalties can be up to two years in prison and up to a $10,000 fine.

On March 2, 2025, the U.S. Department of the Treasury announced that, in relation to the Corporate Transparency Act (CTA), it would not enforce penalties or fines against domestic reporting companies and their beneficial owners for failure to file beneficial ownership information (BOI) reports under the existing regulatory deadlines. (Maynard Nexsen) Subsequently, on March 26, 2025, the Financial Crimes Enforcement Network (FinCEN) issued an interim final rule, effective immediately, which exempts all U.S.- incorporated companies (previously “domestic reporting companies”) and U.S. persons from the BOI-reporting obligations under the CTA. (U.S. Department of Treasury, 2025).

Under the revised rules: (1) U.S. based companies and U.S. beneficial owners are no longer required to file BOI reports under the Corporate Transparency Act. (2) The CTA’s BOI reporting obligations will now be focused solely on “foreign reporting companies”. (3) For those foreign reporting companies that remain subject to the CTA, new deadlines have been established: for those registered before March 26, 2025, an initial report is due by April 25, 2025; for those registering on or after March 26, 2025, the report is due within 30 calendar days of the entity’s registration becoming effective. (U.S. Department of Treasury, 2025)

• Beneficial Ownership Information Access and Safeguards
• Frequently Asked Questions: Beneficial Ownership Information

Akalp, N. (2024, July 11). Do you need to file a BOI report? Forbes Magazine. https://www.forbes.com 

Financial Crimes Enforcement Network. (2023, September 18). Beneficial ownership information frequently asked questions. FinCEN. https://www.fincen.gov/boi-faqs

Financial Crimes Enforcement Network, U.S. Department of the Treasury. (2024, January). Beneficial ownership information reporting filing instructions. https://boiefiling.fincen.gov

Maynard Nexsen PC. (2025, March 5). Department of Treasury announces halt in enforcement of the CTA against U.S. citizens and reporting companies. https://www.maynardnexsen.com/publication-department-of-treasury-announ…- enforcement-of-the-cta-against-u-s-citizens-and-reporting-companies

Small Business Development Center. (2024, May 14). More BOI reports will be filed than business income tax returns in 2024 and small businesses need your help. https://www.americassbdc.org

U.S. Department of the Treasury. (2024, February). Small entity compliance guide for beneficial ownership information access and safeguards requirements. https://www.fincen.gov

U.S. Department of the Treasury. (2025, March 26). U.S. Treasury Department announces publication of interim final rule [Press release]. https://home.treasury.gov/news/pressreleases/ sb0060