FinCEN Updates on BOI Reporting Requirements – September 2024

Stephanie Glanville | September 27, 2024 | Read time: 7 minute(s) | BOI Reporting, FinCEN Update | No Comments

On September 10, 2024, FinCEN introduced a few important updates to the Beneficial Ownership Information (BOI) reporting requirements. These new rules and guidelines are essential for ensuring that businesses stay compliant with the latest regulatory standards.

This article explores recent updates, including new FinCEN FAQs that clarify reporting obligations for companies, addressing key questions, particularly for those that cease operations or are foreign entities. Understanding these updates will help businesses navigate their reporting duties effectively and avoid potential compliance issues.

Reporting Requirements for Ceased Companies

In July 2024, FinCEN issued initial updates regarding reporting requirements for ceased companies. On September 10, 2024, additional details were provided to clarify these reporting requirements.

According to the latest updates, any reporting company created or registered in 2024 must file its BOI Report with FinCEN within 90 days of receiving public notice of its creation or registration. For companies established in 2025 or later, the reporting deadline is reduced to 30 days from receiving public notice. This rule applies regardless of how quickly the company ceases operations or undergoes dissolution.

If a company that has filed an initial BOI Report ceases to exist, it is not necessary to file an additional report after dissolution. The initial BOI Report filed prior to the company’s dissolution is considered sufficient.

Who can file a BOI Report for Dissolved Companies?

Under the updated rules, a BOI Report can be filed by anyone authorized by the reporting company. This includes employees, owners, or third-party service providers. Even if the company has ceased to exist, the authorized individual or entity can submit the BOI Report on its behalf.

If a reporting company is set to dissolve before the end of the 30-day or 90-day reporting period, the company needs to make arrangements in advance. These arrangements should ensure that the BOI Report is filed on its behalf before or shortly after its dissolution. The responsibility to ensure timely submission of the report rests with the reporting company while it is still operational.

Reporting Requirements for Foreign Companies

As per the new updates from FinCEN, when foreign companies that have ceased doing business in the United States prior to January 1, 2024, are exempt from reporting its beneficial ownership information to FinCEN. This exemption holds once these companies have completed the formal and irrevocable process of withdrawing its registration to conduct business in the U.S.

It’s important to understand that if a foreign company has fully withdrawn its registration before the specified date, it is no longer subject to any reporting requirements. This is a significant relief for companies looking to exit the U.S. market, allowing them to focus on their operations without the burden of compliance obligations.

However, if a foreign company was registered to do business in the U.S. at any point on or after January 1, 2024, it will still be required to report beneficial ownership information, even if it ceased operations prior to that date. Therefore, companies must proactively manage their registration status to avoid unnecessary reporting requirements.

Historical Beneficial Owners in Initial Reports

Under the new updates, the initial BOI report must only include the information of the beneficial owners who are part of the company during the filing process. Companies must notify FinCEN of any changes to beneficial owners and related BOI through updated reports.

When a company created or registered in the current tax year 2024 or later ceases to exist before the reporting deadline, the BOI report must contain the correct and accurate beneficial ownership information before the company ceases to exist.

Conclusion

These are the new reporting FAQs that FinCEN has introduced. These FAQs are essential to completing your BOI reporting process. So keep a note of these updates and meet your FinCEN compliance without any hurdles. Of course, it’s a complex process to complete your reporting process smoothly, and filing your BOI report in a secure platform is also a key factor. Here, TaxBandits comes into play!

TaxBandits is one of the leading e-filing platforms and the most trusted platform for streamlining your BOI reporting process. We offer a comprehensive solution with a fantastic workflow that helps you manage your reporting process. We tailored exclusive features and an amazing pricing option for tax pros and high-volume filers who deal with multiple BOI reports.

Stay updated with new requirements and get started to e-file your BOI report with TaxBandits.