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Understanding the Beneficial Ownership Reporting Requirement: Don’t Miss the Year-End Deadline

Learn the beneficial ownership reporting requirement, key deadlines, and filing steps to stay compliant with regulations under the Corporate Transparency Act.
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Ryan Geary

This article is geared toward business owners and/or anyone who may have any ownership in a “reporting company”.  A reporting company is defined for these purposes as a corporation, limited liability company (LLC), or any entity created by the filing of a document with a secretary of state or any other similar office under the law of a state.  This is intended to be a friendly reminder for anyone who has not filed their beneficial ownership information with FinCEN yet.  With all the year-end to-do, we didn’t want this to slip through the cracks. We have provided information on the deadlines, how to file, etc. below. 

 As we approach the close of 2024, a crucial compliance deadline for many U.S. companies is fast approaching. Effective January 1, 2024, the Financial Crimes Enforcement Network (FinCEN), a bureau of the U.S. Department of the Treasury, began accepting beneficial ownership information reports, a requirement mandated under the Corporate Transparency Act (CTA) of 2021. This new regulation aims to curb illicit finance activities by ensuring transparency in corporate ownership.

Here’s what business owners need to know about this beneficial ownership reporting requirement and the upcoming deadline.

What is Beneficial Ownership Reporting?

Beneficial ownership reporting is now a federal requirement for many companies doing business in the U.S. Under this mandate, a “reporting company” must disclose essential information about individuals who directly or indirectly own or control 25% or more of the company. This information is stored in a centralized database managed by FinCEN to help prevent money laundering, terrorism financing, and other financial crimes linked to corporate anonymity.

Important Deadlines for Beneficial Ownership Reporting

  1. Existing Companies: Companies registered or created in the U.S. before January 1, 2024, must file beneficial ownership information by January 1, 2025.
  2. New Companies: For companies created or registered on or after January 1, 2024, reporting must occur within 90 days of the company’s creation or registration

What Information Do Companies Need to Report?

The following details are required for each beneficial owner:

  • Full legal name
  • Date of birth
  • Residential or business address
  • Identification number and issuer (e.g., a U.S. driver’s license, passport, or another government-issued ID)

In addition, companies created on or after January 1, 2024, must also submit information on individuals involved in forming the company, known as “company applicants.”

How to File and Stay Compliant

FinCEN has made the filing process straightforward and secure, ensuring that compliance doesn’t become a burden. Filing is done through FinCEN’s online portal, which is available at no cost. There are also a number of resources available, including:

  • The Small Entity Compliance Guide – a resource that explains filing requirements in simple terms.
  • Informational videos and webinars – helpful for companies looking for an easy overview of the process.
  • FAQs and contact support – FinCEN’s website also includes an FAQ section and a contact center for additional questions.

Visit FinCEN’s BOI Portal to access these resources and begin your filing process.

Penalties for Non-Compliance

Failure to file the required information or submitting inaccurate details can result in substantial penalties, including fines and, in severe cases, criminal charges. Business owners should not delay, as the filing process may take time depending on the complexity of ownership structures.

Act Now to Meet the January 1, 2025 Deadline

For companies formed before January 1, 2024, the deadline is less than two months away. Ensuring compliance with the beneficial ownership reporting requirement is essential to avoid penalties and maintain good standing. Review your records, gather the necessary information, and complete your filing with FinCEN before the year-end to meet the January 1, 2025 deadline.

The views expressed represent the opinion of Resolute Wealth Advisor, Inc. (RWA). The views are subject to change and are not intended as a forecast or guarantee of future results. This material is for informational purposes only. It does not constitute investment advice and is not intended as an endorsement of any specific investment. Stated information is derived from proprietary and nonproprietary sources that have not been independently verified for accuracy or completeness. While RWA believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability. Statements of future expectations, estimates, projections, and other forward-looking statements are based on available information and the RWA’s view as of the time of these statements. Accordingly, such statements are inherently speculative as they are based on assumptions that may involve known and unknown risks and uncertainties. Actual results, performance or events may differ materially from those expressed or implied in such statements. Investing in equity securities involves risks, including the potential loss of principal. While equities may offer the potential for greater long-term growth than most debt securities, they generally have higher volatility. International investments may involve risk of capital loss from unfavorable fluctuation in currency values, from differences in generally accepted accounting principles, or from economic or political instability in other nations. Past performance is not indicative of future results.

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