Deadlines are looming for companies deemed to be “reporting companies” under the Beneficial Ownership Information Reporting Requirements (the “BOI Reporting Rule”) under the federal Corporate Transparency Act (the “CTA”). Most business entities in the United States are expected to be subject to the BOI Reporting Rule. The deadline for a reporting company’s initial BOI Report filing is January 1, 2025 (or sooner, if the reporting company was created or registered on or after January 1, 2024). Business entities should take action as soon as possible to determine if they are “reporting companies” required to comply with the BOI Reporting Rule, to identify their “beneficial owners” and “company applicants” and gather all information needed for reporting, and to submit their initial BOI Reports. Failure to comply in a timely manner may result in substantial fines (currently, $591 per day) and, if the violation is willful, even imprisonment.
BLM&H has previously written an extensive summary of the BOI Reporting Rule, including on topics such as what companies are “reporting companies”, how to identify a reporting company’s “beneficial owners” and “company applicants”, and what information must be included in a BOI Report (“Corporate Transparency Act Beneficial Owner Information Reporting Requirements Take Effect on January 1, 2024 – What Business Entities Need to Know and Do”).
Determining whether a business entity is a “reporting company” and identifying who a reporting company’s “beneficial owners” are can be complex. There are various exemptions and exceptions to the definition of “reporting company” and an individual can be a “beneficial owner” by virtue of direct or indirect ownership (or control of ownership interests) of a reporting company or by virtue of the direct or indirect ability to exercise “substantial control” over a reporting company. Each of these terms has its own set of exceptions and nuances. Accordingly, business entities that have not yet assessed whether they are “reporting companies” or who are their “beneficial owners” should conduct this assessment immediately. Further, any business entity that is determined to be a “reporting company” should gather all required information for its initial BOI Report filing as soon as possible to ensure it meets the applicable filing deadline.
BLM&H can help you understand and comply with the BOI Reporting Rule. If you have questions about the BOI Reporting Rule or if you need help preparing for and making your company’s initial, updated or corrected filings, please contact:
Kevin J. Loechl, kloechl@blmhlaw.com, 404.266.3205
Hunter Holliday, hholliday@blmhlaw.com, 404.266.3206
Quincy H. Jackson, qjackson@blmhlaw.com, 404.266.3212
Colton E. Francoeur, cfrancoeur@blmhlaw.com, 404.266.3217