In 2024, FinCEN is set to embark on a new requirement, which will require many companies (LLC, Corporations, Non-Profits, etc.) to report who owns and controls these companies that have been filed. Unfortunately, this isn’t just for those who prepare to file in 2024, but for companies who have also filed in the past.
If you’re not sure who FinCEN is, they’re a bureau of the U.S. Department of the Treasury whose job is to protect the financial system by monitoring financial transactions and data to combat illegal activity and money laundering. They are the people who “follow the money” and keep an eye out for illegal transactions within the government.
So what does FinCEN have to do with Beneficial Ownership? FinCEN is now requiring certain companies to provide certain identifying information for the beneficial owners of these companies such as the people who control such companies or the ones who register these companies with their particular state of incorporation. Both parties will be required to provide information whether they are the controller of the company or the person who filed. This will be effective January 1, 2024 and no earlier.
This is all due to the Coroporate Transparancy Act that congress passed in 2021 to keep shell companies or those who have ill intent from creating companies for illegal activity. The information will have to be uploaded to a secure database including identification images and other information. This includes both domestic and foreign entity types. On FinCEN’s site you can find the list of those who are exempt from filing here. FinCEN has this great list on their site that makes it easier to determine if you need to file.
So, if you’re not exempt, where does this leave you? This information will have to be filed starting January 1st of the New Year. As of today, companies who file after the January 1st deadline will have 90 days to submit the information regarding the control and registration of their entity. Those who have filed before ( a whopping 240 million entities or more) will have until January 1, 2025, to file their initial Beneficial Ownership Information. After the inaugural year, each corporation created after January 1st, 2025 will have 30 days to file the information.
Now where do we go from here and what do we do on January 1st as this requirement takes effect? Stay tuned as we give you the proper resources and information to guide you to make the filing of information easier and the distributing of information easier in our next post. Want more information sent directly to your email? Contact us here and get added to our email list on FinCEN updates!
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