UPDATE – February 27, 2025 – FinCEN has announced that it will not impose fines or penalties related to BOI deadlines or take enforcement actions until the forthcoming interim final rule becomes effective. (Read Official Notice)
FinCEN Beneficial Ownership “BOI” Reporting Rule deadline March 21: What Businesses Need to Know
With the Beneficial Ownership Information (BOI) reporting deadline set for March 21, 2025, businesses must prepare to comply with new transparency requirements introduced by FinCEN under the Corporate Transparency Act (CTA). This reporting rule expands earlier efforts by FinCEN, which previously targeted specific real estate markets through Geographic Targeting Orders (GTOs), requiring disclosure of beneficial ownership in certain all-cash real estate transactions in metropolitan areas.
Initially scheduled for January 1, 2024, the BOI compliance deadline experienced delays due to legal challenges and regulatory reviews but is now firmly established. The rule mandates that entities disclose their beneficial owners—individuals owning or controlling at least 25% of the business—to FinCEN.
From Real Estate to Broad Transparency: The Evolution of BOI Reporting
For years, FinCEN has played a critical role in financial transparency within the real estate industry. A bureau of the U.S. Department of the Treasury, FinCEN combats money laundering, terrorist financing, and other financial crimes through regulatory enforcement and intelligence gathering. Since 2016, FinCEN has enhanced financial transparency through Geographic Targeting Orders (GTOs), which require title insurance companies to report beneficial ownership of certain all-cash real estate purchases in high-risk areas. Currently, Arkansas and Missouri are not among the areas targeted by FinCEN’s Geographic Targeting Orders.
Beyond real estate, financial transparency has expanded with the Beneficial Ownership Information (BOI) Reporting Rule under the Corporate Transparency Act (CTA), mandating that a broad range of entities disclose their beneficial owners—those who own or control at least 25% of the entity—to FinCEN. While state-licensed insurance producers such as title agencies are exempt, many other business entities must comply with this new requirement. Business owners should assess whether any of their entities fall under the BOI reporting requirements to avoid non-compliance risks. FinCEN BOI FAQs
Implications for Businesses
With the compliance deadline now firmly set, businesses must take immediate action to ensure they meet the March 21, 2025, deadline. The following steps should be prioritized:
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- Verify Business Information – Gather and review the necessary documentation to ensure accuracy in reporting.
- Stay Updated – Monitor FinCEN and Department of Treasury announcements for any further guidance.
- Seek Professional Advice – Consult with legal or financial professionals to confirm compliance and mitigate potential risks.
- File Required Reports – Ensure that your business submits beneficial ownership information to FinCEN before the deadline.
Non-Compliance Penalties
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- Civil Penalties: Entities failing to file or providing incorrect information may incur penalties up to $591 per day for each day the violation continues.
- Criminal Penalties: Willful failure to comply, submitting false information, or deliberately neglecting to update reports can result in fines up to $10,000 and imprisonment for up to two years.
Conclusion
The FinCEN Beneficial Ownership Reporting Rule represents a significant shift toward greater corporate transparency. While previous legal challenges temporarily delayed enforcement, businesses must now prepare to comply with the firm deadline.
As a business owner, you are uniquely positioned to share critical insights about the BOI reporting requirements with other related businesses, such as REALTORS®, Homeowners Associations, and other small business owners in your network. These groups often work closely with entities that may be impacted by the rule but might not be fully aware of their obligations under the Corporate Transparency Act. By educating them on the requirements, deadlines, and potential penalties discussed in this article, you can help them stay compliant and avoid costly fines. This proactive approach not only strengthens your professional relationships but also reinforces your role as a trusted resource in the community.
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