Your BOIR is required by law

Did you know that under the Corporate Transparency Act, there is a new beneficial ownership information reporting requirement? This is part of the U.S. government’s efforts to make it harder for bad actors to hide or benefit from their ill-gotten gains through shell companies or other opaque ownership structures. In 2021, Congress enacted the bipartisan Corporate Transparency Act to curb illicit finance. This law requires many companies doing business in the United States to report information about who ultimately owns or controls them.

What is a BOIR?

Beneficial ownership information refers to identifying information about the individuals who directly or indirectly own or control a company.

The Beneficial Ownership Information Report (BOIR, also known as BOI Report) provides details about the people who own and control businesses that operate in the U.S. It's part of a broader effort to combat money laundering and other criminal activity that threaten fair business practices.

In 2022, Financial Crimes Enforcement Network (FinCEN) issued a final rule requiring certain entities to file with FinCEN reports that identify two categories of individuals: the beneficial owners of the entity, and individuals who have filed an application with specified governmental authorities to create the entity or register it to do business. These requirements are intended to help prevent and combat money laundering, terrorist financing, corruption, tax fraud, and other illicit activity, while minimizing the burden on entities doing business in the United States.

Who has to file a BOIR?

1. A corporation, a limited liability company (LLC), or was otherwise created in the United States by filing a document with a secretary of state or any similar office under the law of a state or Indian tribe; or

2. A foreign company and was registered to do business in any U.S. state or Indian tribe by such a filing.

U.S. based small businesses registered as an LLC or Corporation:

• Under $5M in revenue 

• Under 21 employees

• Owners with 25% or more ownership

• There are 23 types of entities that are exempt from the reporting requirements (FINCEN)

Failure to report can result in severe penalties

Failure to properly file a BOI report may incur severe civil and criminal penalties, including fines of up to $100,000 and up to two years of prison time.

The owners of any company that willfully violates the BOI reporting requirements may be subject to civil penalties. The penalties start at $500 for each day that the violation continues. Owners may also be subject to criminal penalties of up to two (2) years imprisonment and a fine of up to $10,000.

Deadlines for Submission

• Existing Companies: A company created or registered before January 1, 2024, must file its initial BOI report by January 1, 2025.

• New Companies: A company created or registered on or after January 1, 2024, must file its initial BOI report within 90 calendar days of its creation or registration​.

How Palm can help 

Palm can e-file your BOI report today for free. When you activate your Palm Membership, you'll also receive:

• Small business expertise-> We are founded and built by SMBs, for SMBs.

• AI-Powered-> We auto-fill your forms with your information to save you time 

• Business Health Insights-> Understand how your business is viewed on the market.

• Resources to help you grow such as weekly newsletters, offers to save on your biggest expenses and weekly blog content to help your small business get ahead.