Beneficial Ownership Information – New Reporting Requirements

Article | February 07, 2024

Authored by Atherton


New Beneficial Ownership Information Report Requirements

As part of the federal government’s anti-money laundering and anti-tax evasion efforts, they are attempting to look beyond shell companies that are set up to hide money. Under the Corporate Transparency Act, corporations, limited liability companies (LLCs), limited partnerships, and other entities that file formation papers with a state’s Secretary of State’s office (or similar government agency) are required to file a Beneficial Ownership Information Report (BOI) with the U.S. Treasury Department’s Financial Crimes Enforcement Network (FinCEN). This report provides specified information regarding the entity’s “beneficial owners.”

Beneficial owners are broadly defined and involve owners who directly or indirectly own more than 25% of the entity’s ownership interests or exercise substantial control over the reporting company (even if they do not have an actual ownership interest). While this may seem to only impact a few significant owners, it can encompass many senior officers of the business as well as those individuals who participate in any significant business decisions (e.g., board members). Given the severity of the fines, it may be safer to err on the side of over-inclusion rather than under-inclusion.

For entities formed after 2023, information must be provided about the company applicants (the person who files the formation/registration papers and the person primarily responsible for directing or controlling the filing of the documents). The types of information required (and kept current) for these beneficial owners include the owner’s legal name, residential address, date of birth, and unique identifier number from a nonexpired passport, driver’s license, or state identification card. The entity will also need to provide an image of any of these forms of documentation to FinCEN for all beneficial owners.

There are various company types that are exempt from this filing. They include: 

  • Securities reporting issuer
  • Governmental authority
  • Bank
  • Credit Union
  • Money services business
  • Depository institution holding company
  • Broker or dealer in securities
  • Securities exchange or clearing agency
  • Other Exchange Act registered entity
  • Venture capital fund adviser
  • Investment company or investment adviser
  • Insurance company
  • State-licensed insurance producer
  • Commodity Exchange Act registered entity
  • Accounting firm
  • Public utility
  • Financial market utility
  • Pooled investment vehicle
  • Tax-exempt entity
  • Entity assisting a tax-exempt entity
  • Subsidiary of certain exempt entities
  • Inactive entity


If your entity does not fall into one of the categories above, you may still be exempt if your entity is considered a “large operating company.” The IRS defines a large operating company as an entity:

  • With 20 full-time U.S. employees. A full-time employee is an employee who is employed an average of at least 30 hours per week. Employer aggregation rules do not apply
  •  With a U.S. physical office; and
  • That filed a federal income tax return in the prior year with more than $5 million in US gross receipts or sales (determined on a consolidated basis for taxpayers filing consolidated returns). Receipts or sales from outside the U.S. are excluded in determining the $5 million threshold.

All three of the rules above must apply to you at all times in order to be exempt from filing. So, if your employee count falls under twenty, you are required to report.

Entities in existence prior to January 1, 2024, have until January 1, 2025, to file these reports. However, entities formed in 2024 will have 90 days from the entity’s formation/registration to file these reports. The deadline changes to within 30 days of formation after 2024. If any of the reported information changes or a beneficial ownership interest is sold or transferred, the entity must report this information within 30 days of the change or face the potential of having the penalties described above imposed. Changes include reporting a beneficial owner’s change of address or name, a new passport number when a passport is replaced or renewed or providing a copy of a renewed driver’s license.

The BOI report must be completed electronically through the FINCEN’s secure filing system called “BOSS,” (Beneficial Ownership Secure System). This system is currently being developed, and they expect it to be available after January 1, 2024.

Unfortunately, we understand that this will impose burdensome reporting requirements on most businesses, but the willful failure to report information and timely update any changed information can result in significant fines of up to $500 per day until the violation is remedied, or if criminal charges are brought, fines of up to $10,000 and/or two years imprisonment. These penalties can be imposed against the beneficial owner, the entity, and/or the person completing the report.

While we can do our best to our your questions directly, we highly recommend you visit the following website, for more information or for FAQs to answer your questions. The registration can be found at

We hope that this information is helpful. Due to the many requirements of this new law, our firm is unable to fill out this information for you. Therefore, this is something that you must complete on your own. Please be sure to review all requirements and ensure that you complete the BOI report in a timely manner.

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Atherton & Associates, LLP was founded almost a century ago by the merger of two of the area’s most successful accounting firms. The firm currently has seven partners who provide services to over 3,500 clients by employing over 50 individuals. As one of the largest accounting firms in the San Joaquin Valley, Atherton & Associates, LLP is a full service firm with Tax, Assurance and Consulting that has the ability and resources to tackle the most complex business situations.

For more information on how Atherton and Associates can assist you, please call us at 209.577.4800.