What Are the Advantages of Securing a Beneficial Ownership Number?
Securing a FinCEN identifier comes with several advantages:
1) Streamlines the submission protocol: Entities required to report can utilize a FinCEN identifier to convey the Beneficial ownership disclosure requirements information data for related parties, thus bypassing the need to submit separate BOI for each individual.
2) Facilitates direct disclosure to FinCEN: Beneficial owners and entities tasked with reporting can acquire a FinCEN identifier to submit their ownership details to FinCEN on a more direct basis, circumventing the need for certain intermediary reporting steps. Know more Customer Due Diligence for Business Owners.
What Information is Needed to Receive a Beneficial Owner Number/FinCEN Identifier?
To acquire a FinCEN identifier, individuals must furnish the following details:
• Full legal name
• Date of birth
• Residential address
• A unique identifying number, along with the jurisdiction where it was issued, as specified in an accepted identification document
• A scanned or photographed image of the identification document
In order to request a FinCEN identifier, companies are required to furnish the following details:
• Legal name of the company
• Tax identification number (TIN)
• State(s) of incorporation or organization
• Date of formation or organization
A company has the option to employ a Beneficial Ownership Number/FinCEN identifier when disclosing the Beneficial Ownership Information. of specific related entities, instead of furnishing the individual's BOI, provided that the following conditions are satisfied:
• The individual is, or may potentially be, considered a What is an Entity Beneficial Owner for an LLC? of a reporting company due to their interest in an entity that, either directly or indirectly, holds a stake in the reporting company.
• The said entity possesses a valid FinCEN identifier.
• The reporting company has acquired the entity's FinCEN identifier through a dependable source, such as directly from the entity itself or from a publicly available resource.
• There is no knowledge or reasonable suspicion on the part of the reporting company that the entity's FinCEN identifier is inaccurate or outdated.
In situations where a reporting company is uncertain about whether it can appropriately utilize a FinCEN identifier to disclose the beneficial ownership information of a specific individual, it is advisable to seek guidance from our organization by contacting our experts via our website.
Can You Summarize the New BOI Law in Effect as of January 1, 2024?
Of course. The Corporate Transparency Act 2023 (CTA), also known as the Beneficial Ownership Information (BOI) law, became effective on January 1, 2024. This legislation compels many entities, including corporations and limited liability companies (LLCs), established or registered for business operations in the United States, to disclose their beneficial ownership details to the Financial Crimes Enforcement Network (FinCEN). Learn here about Financial Crimes Enforcement Network (That's about 32 million businesses!) The primary aim of this disclosure requirement is to ascertain the individuals who ultimately possess or exercise significant control over these entities.
For companies in existence or registered before the effective date of January 1, 2024, there will be a one-year grace period, allowing them until January 1, 2025, to submit their initial reports. Conversely, entities formed or registered after the commencement of 2024 will be obligated to submit their initial reports within 30 days of receiving notification of their establishment or registration. The BOI report will encompass information about the company itself and its beneficial owners, and non-compliance with this reporting requirement may lead to both civil and criminal penalties. Want to know about NSBA, The National Small Business Association?