In 2024, the Corporate Transparency Act (CTA) will bring significant changes to the way businesses in Pennsylvania report their ownership and control structures. The new Beneficial Ownership Information (BOI) reporting requirements aim to combat terrorism, money laundering, and the concealment of control and ownership in business entities. This article will explore the key aspects of BOI reporting for Pennsylvania businesses and provide guidance on how to ensure compliance with the new regulations.
What is BOI Reporting?
BOI reporting is a federal requirement that mandates certain entities, known as “reporting companies,” to disclose information about their beneficial owners and company applicants to the Financial Crimes Enforcement Network (FinCEN), a bureau of the U.S. Department of the Treasury.
Who are Reporting Companies?
Reporting companies include domestic corporations, limited liability companies (LLCs), or similar entities registered at the state level, and foreign entities conducting business in the U.S. Businesses that employ more than 20 employees on a full-time basis in the United States and demonstrate more than $5 million in gross receipts or sales are exempt from the BOI reporting requirements.
What Information Must be Reported?
If a company is not exempt from reporting, the following information must be included in the initial BOI report:
- Full legal name and dba
- Address of primary location in the U.S.
- State or other jurisdiction of formation
- EIN/TIN
- Full legal name, date of birth, address of residence, identification number set forth on a non-expired government-issued identification document, and an image of that document for each beneficial owner and company applicant
Filing Deadlines and Procedures
The deadline for filing the initial BOI report varies depending on the company’s date of formation, incorporation, or registration with the secretary of state or similar body:
- Companies formed before January 1, 2024, must file a BOI report by January 1, 2025.
- Companies formed on or after January 1, 2024, but before January 1, 2025, must submit the BOI report within 90 days of formation.
- Companies formed after January 1, 2025, must file the BOI report within 30 days of formation.
Any changes to reported information must be updated within 30 days of the alteration.
Penalties for Non-Compliance
Failure to comply with CTA reporting requirements may lead to significant penalties, including up to $10,000 in fines and imprisonment for willful violations.
Conclusion
The new BOI reporting requirements under the Corporate Transparency Act will have a significant impact on Pennsylvania businesses in 2024. It is crucial for business owners to familiarize themselves with the reporting requirements, identify whether their company is exempt, and ensure compliance by the applicable deadlines. Seeking legal counsel for guidance on CTA compliance and reporting obligations is highly recommended to avoid penalties and maintain the integrity of business operations.
Tags: BOI reporting for Pennsylvania