Any individual who, directly or indirectly, either (1) exercises substantial control over a reporting company, or (2) owns or controls at least 25 percent of the ownership interests of a reporting company. The rule defines the terms “substantial control” and “ownership interest.” In keeping with the CTA, the rule exempts five types of individuals from the definition of “beneficial owner.”

• In defining the contours of who has substantial control, the rule sets forth a range of activities that could constitute substantial control of a reporting company. This list captures anyone who is able to make important decisions on behalf of the entity. FinCEN’s approach is designed to close loopholes that allow corporate structuring that obscures owners or decision-makers. This is crucial to unmasking anonymous shell companies.
• The rule provides standards and mechanisms for determining whether an individual owns or controls 25 percent of the ownership interests of a reporting company.

Retail, Professional Services, Real Estate, Construction, Technology, Wholesale Trade, Hospitality, and Healthcare

However, there are exemptions for these industries. Any company that checks one of the following boxes is exempt from filing a BOI report:

• Employs over 20 employees on a full-time basis
• Maintains a physical office within the United States
• And has filed federal taxes within the most recent tax year that depict more than $5 million in gross sales

There are also other industries that are highly regulated which are exempt under the Corporate Transparency Act

Beginning on January 1, 2024, the Financial Crimes Enforcement Network, FinCEN, will require businesses in all sectors to file beneficial ownership information, or BOI reports, in an effort to reduce money laundering and other illicit financial efforts.

Businesses established prior to 2024 must file BOI reports by January 1, 2025. Businesses formed in 2024 must file BOI reports within 90 days of its formation date.

FileForms understands the BOI report filing process and offers filing services to businesses in need.

Businesses utilize our platform to determine whether they are a reporting entity required to file a BOI report based on the new laws of the Corporate Transparency Act.

Businesses filing a BOI report need to include the following information in their initial filing:

• The full legal name of the business
• Any nicknames or trade names that the business alternatively operates under
• The current street address of the business’ location
• The jurisdiction in which the business was formed
• Taxpayer identification number

Similarly, a business’s beneficial owners and company applicants must include their full legal names, dates of birth, and current residential address alongside an identifying number, such as a:

• US passport
• Local or state ID
• Driver’s license number
• A foreign passport, if applicable

Beneficial owners and company applicants will need to include pictures of their chosen document in the report.