UPDATE:
BOI reporting has been suspened! On Dec. 3, 2024, a District Court in Texas placed a preliminary nationwide injunction on new Beneficial Ownership Information (BOI) reporting requirements imposed by the Corporate Transparency Act. It is expected that this decision will be appealed by the Treasury so stay tuned for more updates. At least for now it appears that the filling is unnecessary.
ORIGINAL POST:
There is a lot of information going around about BOI reporting and we've had a lot of calls wanting to know if it’s legitimate. The short answer is “yes”. If you have a business, then you should probably register by December 31st. The Tax Company is available to file this report for our existing clients for just $50. All we need is a photo of your driver’s license. However, there's a LOT more to the story.
Here is the longer answer:
In 2022, congress passed the “Corporate Transparency Act” which required all businesses in the United States to report its ownership to The Financial Crimes Enforcement Network (FinCEN), a division of the Treasury Department which also oversees the IRS. The purpose of the act was to combat terrorism and money laundering, but the program has been met with controversy.
The law says that any new business created in 2024 or after must be registered within 90 days of formation. Existing businesses have until the last day of 2024. The penalty for failure to file is $500 per day up to $10,000 and a potential 2-year prison term. So far, only about 20% of the 100 million businesses in the US have registered. This is partly due to lack of information and partly because many believe the law to be unjust. And for good reason!
Earlier this year, the Alabama chapter of the National Association of Small Business (NASB) won a lawsuit against the Department of Justice (DOJ) declaring the law to be unconstitutional. Their victory means that NASB members in Alabama are exempt but the rest of the country still has a filing requirement… at least for now!
Fourteen other states currently have cases pending which oppose the act and it is expected that the Supreme Court will rule on it sometime next year. President-elect Trump has also hinted that he will use an executive order to quash the law once he takes office in January. The AICPA has even requested that congress extend the due date for filing but so far nothing has been confirmed.
So, at least for now, if you own any type of LLC, corporation or irrevocable trust, then the report technically "should" be filed by the end of the year. As always, we are happy to assist if you would like to reach out with a copy of your driver’s license. (At just $50 for existing clients that is about a tenth of what some firms are charging.) Having said that, the report is relatively simple so you may prefer to take care of it yourself. It takes about 15 minutes and all you need is your EIN and a picture of your driver's license. If you don't have an EIN for your business, then it likely means that you are not required to file.
If you decide to go that route, here is the website along with a brief tutorial:
If not give us a call and as you contemplate how to proceed, remember what my brother likes to say, “Indecision plus time equals a decision.” Here’s hoping it’s the right one.
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