Beginning January 1, 2024, the Beneficial Ownership Information (BOI) Report will affect real estate developers and investment property owners across the United States. If you’re in the real estate industry and you’re wondering what in the world is the BOI report, or you’re rightfully interested in how this piece of legislation will affect you, you’re in the right place.
The Beneficial Ownership Information (BOI) Report is a new filing requirement from the Corporate Transparency Act of 2020. Certain businesses must disclose specific details of their beneficial owners to the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN).
This report must be filed by a wide range of entities, including corporations, partnerships, and limited liability companies (LLCs).
If an entity was formed prior to January 1, 2024, the report will be due no later than January 1, 2025. If the entity is formed after January 1, 2024, the report is due within 90 days of inception or a beneficial owner or entity change of information.
If you are a real estate developer or investment property owner here in the United States, buckle up and get ready, because you are affected by this piece of legislation.
Simply put, you’re going to have to file a BOI Report for each entity. To do this, you’ll have to gather all the correct information for each beneficial owner for each entity with which you’re involved. Yes, even holding companies and multi-layered ownership structures with multiple investors all must be disclosed in the report.
On the surface, filing the BOI report is free if you do it yourself through FinCEN. Seems straight forward, right?
Although free, filing through FinCEN can be complex and time consuming. If you decide to take this route, go ahead and set aside two to three hours to file each BOI report, and that’s just for a simple corporate structure with a couple beneficial owners.
If you forget to file, misfile the report, or if you miss information, or worse, you input false information, you’ll be susceptible to penalties. We’re not talking small amounts, either.
Penalties for willful misfiling, or not filing at all, include a monetary fine of $500 per day, up to $10,000 per entity. Imprisonment can also be involved, to the tune of up to two years (or 10 years, if you’re found to be fraudulent). $500 per day multiplied by 10s or 100s of entities within a portfolio can get to be quite expensive, quick.
If all of this sounds daunting, if it makes your stomach turn, you can rest (or read) easy from this point forward. FileForms is here to help!
FileForms has built a technology and customer service platform that reduces this long, arduous filing process down to just minutes. FinCEN estimates that a complex ownership structure will take approximately 650 minutes to complete! On top of that, you can feel good about filing with FileForms, because your BOI report will be filed accurately, correctly, and in a timely manner. Our user experience and website is full of information and education if you are the type of person who likes to read more.
As a real estate developer or investment property owner, this new Beneficial Ownership Information Report requirement will, indeed, affect your business(es). Instead of spending hours of your time hoping you’ve input the correct information on a government report so you don’t get fined (or go to jail), get started with FileForms now!