FinCEN’s Beneficial Ownership Information (BOI) Reporting for
an LLC
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What’s Covered?
- What is BOI reporting?
- BOI reporting requirements
- What are the exemption codes?
- How TaxBandits simplify BOI reporting?
A recent court order temporarily suspends the FinCEN BOIR requirement for reporting companies.
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Beneficial Ownership Information (BOI) Reporting For LLC
Written by Stephanie Glanville
Stephanie Glanville is the Marketing Manager of TaxBandits. She has several years of experience with IRS tax forms and the funtionality of TaxBandits. With a passion to help business owners better understand their IRS tax forms and filing, she aims to create content that is valuable and informative.
Effective on January 1, 2024, many businesses are now required to submit BOI Reporting with FinCEN. This new reporting obligation will affect the majority of small businesses. Many companies that are organized as an LLC will be affected. This article will provide further information on how LLCs can determine whether or not filing is necessary.
Table of Contents:
- What are the BOI Reporting Requirements for Limited Liability Companies (LLCs)?
- What are the Exemptions for LLCs Filing the BOI Report?
- Is the size of an LLC a factor that qualifies for an exemption?
- What is the information required to complete the BOI Report for LLC?
- Does an LLC have a Beneficial Owner?
- Does an LLC have a company applicant?
- When should an LLC file its initial BOI report?
- How and where does my LLC file its initial BOI report?
1. What are the BOI Reporting Requirements for Limited Liability Companies (LLCs)?
According to the Corporate Transparency Act (CTA), entities classified as “Reporting Company” must file a Beneficial Ownership Information Report (BOIR) with FinCEN. Since LLCs are classified as reporting companies, every LLC established in the United States must submit the BOIR (BOI Report) unless it qualifies for an exemption.
Determine your business is exempt form BOI reporting with our BOIR Exempt Checker
2. What are the Exemptions for LLCs Filing the BOI Report?
According to FinCEN, there are 23 types of entities that are exempt from BOI reporting, However, it's important to understand that most LLCs probably won’t qualify for these criteria. Generally, the exemptions are aimed at entities that are already subject to government regulations, including public corporations, financial institutions, insurance companies, and tax-exempt entities.
3. Is the size of an LLC a factor that qualifies for an exemption?
Yes, an LLC can be exempt from submitting the BOIR to FinCEN if it meets certain criteria related to its size. To qualify for exemption, the LLC must:
- Having more than 20 full-time employees.
-
Have a physical office located within the
United States. -
Have filed a federal income tax or information return for the previous year, revealing gross receipts or sales over
$5 million.
4. What is the information required to complete the BOI Report
for LLC?
To complete the BOI Report for an LLC, the following information is required:
Reporting Company Information:
- LLC Legal Name
- Trade Name
- Primary Business Address
- Jurisdiction of Formation
- Taxpayer Identification Number
For Each Beneficial Owner:
- Legal Name
- Date of Birth
- Residential Address
- Unique Identifier from a Driver's License, Passport, or State ID, along with an image of the document displaying that identifier
Company Applicant Information (For LLCs established on or after January 1, 2024):
- Legal Name
- Date of Birth
- Residential Address
- Unique Identifier from a Driver's License, Passport, or State ID, along with an image of the document displaying that identifier
Click Here to know more about the BOI Filing Instructions.
5. Does an LLC have a Beneficial Owner?
Yes, an LLC does indeed have a beneficial owner. According to the Corporate Transparency Act (CTA), a beneficial owner is someone who holds substantial control over a reporting company, either directly or indirectly. This typically means having ownership or control of at least 25 percent of the company's ownership interests.
Any individuals fitting this description are considered beneficial owners. Even when no single individual owns a quarter of the LLC, one or more individuals will still have the capacity to make crucial decisions for the LLC or exert significant control over
its operations.
6. Does an LLC have a company applicant?
LLCs formed on or after January 2024 must disclose the details of the company applicant in the BOIR. A Company Applicant refers to an individual or entity responsible for submitting the formation documents to state authorities, Indian tribes, or other U.S. jurisdictions. An LLC may have up to two company applicants. If more than two individuals or entities are involved in filing, the one primarily overseeing or managing the filing process will be designated as the company applicant.
7. When should an LLC file its initial
BOI report?
Your LLC can submit its initial BOI report according to the following timelines:
LLCs established prior to January 1, 2024:
-
The initial report must be submitted by
January 1, 2025.
LLCs founded between January 1, 2024, and January 1, 2025:
-
The initial report must be filed within 90 calendar days upon receiving official or public notice of
their establishment.
LLCs established on or after January 1, 2025:
-
Required to submit their initial report within 30 calendar days of receiving official or public notice of
their formation.
8. How and where does my LLC file its initial BOI report?
Your LLC will need to file its initial Beneficial Ownership Information (BOI) report with the Financial Crimes Enforcement Network (FinCEN). This report should include information about the individuals who have significant control over or ownership in your LLC. To navigate the requirements and avoid hefty penalties, you need a reliable partner to guide you through the process and ensure your report is filed correctly. That’s where TaxBandits comes in!
TaxBandits Simplifies Your LLC BOI Filing with
Efficient Features
- Complete your BOI Report in minutes using TaxBandits’ user-friendly application.
- Easily file initial and updated BOI Reports.
- Amend your BOI Report at no extra charge within 7 days of submission.
- Receive ongoing status notifications from TaxBandits after filing your BOI Report.
LLCs trust TaxBandits for a BOI Reporting solution that is seamless, secure, and efficient!
BOI Reporting Requirements for Limitied
Liability Company (LLC)
When it comes to BOI reporting,Limited Liability Companies (LLCs) need to follow specific rules based on their structure,
including how different roles and scenarios impact reporting requirements.
Scenario 1: LLC as Reporting Company
- Under the Corporate Transparency Act (CTA), your LLC is classified as a ‘Reporting Company’ and must file a BOI Report with FinCEN. Every LLC established in the United States must prepare and submit a comprehensive BOI Report unless it meets specific
exemption criteria.
Scenario 2: Exemptions for LLC
- If your LLC meets specific criteria, it may be exempt from filing a BOI report. However, most LLCs are unlikely to qualify for these exemptions, which generally apply to public corporations, financial institutions, insurance companies, and tax-exempt entities. If your LLC doesn’t fall into these categories, you should prepare to file a BOI report.
Scenario 3: Company Applicant of an LLC
- For LLCs established or registered from January 1, 2024, you must report the company applicant details in the BOI report. The company applicant is responsible for preparing the documents for state registration. Your LLC can have up to two company applicants, but if more are involved, designate the primary individual. Note that legal entities or organizations can’t be
company applicants.
Scenario 4: Beneficial Owners of an LLC
- Your LLC must report its beneficial owners, defined as individuals or entities with substantial control or those who own or control more than 25% of the LLC. Even if no single person owns 25%, individuals with significant control or decision-making authority must still
be reported.
Scenario 5: LLC as Service Providers
- As an LLC, you can act as a service provider by managing and submitting BOI reports on behalf of your members or associated entities. To make this process easier, you can use TaxBandits.
- White Label: Customize and brand our platform as your own to provide a seamless experience.
- Referral Program: TaxBandits’ referral program gives you incentives to bring new clients to the
reporting service. - API: Automate BOI reporting by integrating our BOI API with your existing system.
Article Sources:
About the Author
Stephanie Glanville is the Marketing Manager of TaxBandits. She has several years of experience with IRS tax forms and the funtionality of TaxBandits. With a passion to help business owners better understand their IRS tax forms and filing, she aims to create content that is valuable and informative.