The NEW Beneficial Ownership Information (BOI) E-Filing System

The following demonstrates what the current administration in Washington, D.C. is doing to small business especially those companies from 1 to 20 employees and/or independent contractors.

The United States Treasury's Financial Crimes Enforcement Network (FinCEN) now administers a reporting system aimed at all manner of small businesses throughout the United States. 

Since the first of this year, any newly established LLC, corporation, LLP and some other business types, including any owner-operator or small fleet who's filed with their Secretary of State to establish the business, have 90 days to report Beneficial Ownership Information (BOI) to FinCen and the Treasury.

The requirement is also in play for businesses that existed prior to the first of the year. Those owner-operators and many small fleets, though, have much more time to report -- the deadline to complete the filing with FinCEN is the end of 2024. 

Penalties for not doing so can be "pretty severe" by the letter of the law when it comes to the BOI reporting program, with civil fines of $500 per day beyond a business's deadline to report, and potential criminal penalties up to imprisonment for the worst cases. 

If that sounds harsh for what amounts to failure to check a few boxes on an online form, there's a reason Treasury is motivated here. The new BOI program was created as a result of the Corporate Transparency Act, legislation passed in Congress in 2021 as part of that year's Defense reauthorization package and aimed at the problem of money laundering from abroad and at home through shell companies. 

Laundering money is fairly easy to do when no one knows who owns the company and this is an attempt to fix that. 

The good news is that reporting looks to be a fairly simple matter for most owner-operators, requiring little more than an individual owner's name, date of birth, address and identifying document like your CDL or passport. The owner applicant must identify his/her company with its name, address and Employer Identification Number (Social Security number will suffice, too, for most one-truck businesses that are LLCs, plus identifying any other individuals either with "substantial control" of the business or with an ownership stake above 25%, such as they may exist.

The following from FinCEN aims to help businesses quickly ID whether or not they fall under the new BOI reporting requirement.

The first question is “Under what law was the company created or formed”. If it were form under the laws of a foreign country and has the company registered to do business in any U.S. State or Tribal jurisdiction by filing a document with a secretary of state or similar office of the State or Tribe. If you answered Yes then you may be a foreign reporting company. If you answered No then you are not a reporting company.

If you answered Yes, you formed the company under U.S. laws and it is NOT a corporation, limited liability, LLC then you are not a reporting company.

But if you are any of the above named including a Tribal jurisdiction then you are a reporting domestic company.

Yes, answers to these questions are part of FinCEN's Small Entity Compliance Guide, which means it's likely your business will need to report. There's a significant exemption for small fleets with 20 or more employees hitting a particular revenue target -- read on for more detail.

It is estimated the new requirement might apply to roughly 75% of owner-operators who've set up LLCs or other business entities with their Secretaries of State. 

Except in certain circumstances (such as if you move your business to a new home base address), it's likely you'll only need to report once in your business's life. After a single report, if you never move, you may never have to report again. 

The bad news: Quick timeline for address-change deadlines with BOI reporting

The bad news is when any registered business changes its address, under the BOI reporting program's terms owners have just "30 days to report the change" to FinCEN, with the same $500 per-day civil fines potentially applying at the end of that 30 days. 

That requirement might be the most urgent among all within the program for owners on the move, given the program's newness and the short time period to report an address change. 

With that tight deadline, and big penalties, NTA recommends that small business owners get with their CPAs to be able to help out and provide some of the information an owner-operator might need, then recommend the owner-operator do the filing him or herself. 

Some other special cases to consider. 

• Larger businesses are exempt. Exemptions to reporting exist not only for particular types of businesses, including many financial institutions, but also a large swath of "large operating companies. That's right, the FinCEN program specifically targets small entities. 
• Any small fleet business that reaches the level of 20 full-time employees and can demonstrate $5,000,000 in revenues annually can avoid the reporting requirement.
• Inactive entities. If you're not currently operating your trucking business yet haven't officially closed down the LLC entity, for instance, you're technically still subject to the reporting requirement if the business was created after January of 2020. 

Say you're an owner who incorporated February 1 of 2020, "lived the high life" during the COVID pandemic spot-market highs then got out in 2022 or 2023, You've still got to report. 

The FinCEN Small Entity Compliance Guide provides the following checklist for inactive entities to help determine if they qualify for the what's dubbed the "Inactive Entity" exemption. 

1. The entity was in existence on or before January 1, 2020 – Yes or No
2. The entity is not engaged in active business – Yes or No
3. The entity is not owned by a foreign person, whether directly or indirectly, wholly or partially. Foreign person” means a person who is not a United States person. A United States person is defined in Section 7701(a)(30) of the Internal Revenue Code of 1996 as a citizen or resident of the United States, domestic partnership and corporation, and other estates and trusts – Yes or No
4. The entity has not experienced any change in ownership in the preceding twelve (12) month period – Yes or No
5. The entity has not sent or received any funds in an amount greater than $1,000, either directly or through any financial account in which the entity or any affiliate of the entity has an interest, in the preceding twelve (12) month period – Yes or No
6. The entity does not otherwise gold any kind or type of assets, whether in the United States or abroad, including any ownership interest in any corporation, limited liability company, or other similar entity – Yes or No 

Businesses must be able to check yes to all six of these conditions to qualify for the Inactive Entity exemption.



Please note there's always been some reporting to FinCEN from entities like private equity managers and hedge funds. The Financial Crimes Enforcement Network is not a new thing.

Yet, in the past they seemed only to go after bigger entities. This is the first time we have seen [the Network] applied to small entities so directly. This clearly shows that since the Democrats have come into power all they want to do is clap down & control small business.

The only way to combat this situation is to remove the current administration from office.