2024 Federal Requirement: The Corporate Transparency Act requires businesses to file FinCEN’s Beneficial Ownership Information Report. Get the eBook for Firms & Filers

Beneficial Ownership Report Simplified: 3 Ways to Confirm Filing

On January 1, 2024, the Corporate Transparency Act took effect, causing most businesses in the USA to file a Beneficial Ownership report

Let’s look at three ways to help you determine if filing a Beneficial Ownership report is on your business agenda.

1. Business Structure Check

Understanding whether your business is structured as a corporation or a Limited Liability Company (LLC) unveils a fundamental aspect of how it operates.

  1. Corporation:
    Ownership Structure: Corporations typically have shareholders who own shares in the company. These shares often represent a proportional stake in the business.
    Decision-Making: Shareholders elect a board of directors, who, in turn, make significant decisions for the company. This hierarchical structure defines the decision-making dynamics.
  2. Limited Liability Company (LLC):
    Ownership Structure: LLCs offer more flexibility, allowing for various ownership structures. Members hold membership interests, and these interests dictate their share of ownership.
    Decision-Making: Members often play a direct role in decision-making or may appoint managers to handle operational choices. This flexibility is a hallmark of the LLC structure.

In short, knowing your business’s legal structure (corporation or LLC) reveals how ownership and decisions are managed, impacting filing obligations.

Corporations, with shareholder hierarchy, may have distinct filing requirements. LLCs, with flexible ownership and direct decision-making, could have different considerations for filing.

2. Beneficial Ownership Assessment

Another significant Beneficial Ownership Information reporting criterion revolves around your workforce and financial performance. Here’s a breakdown:

  1. Employee Threshold:
    •Does your company maintain a workforce of 21 or more full-time employees?
  2. Sales Threshold:
    •Does your company report over $5,000,000 in sales on your last year’s business tax return?

To summarize, a “small operating company,” generally required to file, is typically characterized by having fewer than 20 full-time employees, no physical office in the U.S., and less than USD 5 million in gross receipts or sales from U.S. sources (as shown on a filed federal income tax or information return).

3. Corporate Transparency Act Exemptions

The FincenFetch Exemption Checker tool is a powerful resource, encompassing 23 exemptions that may relieve you from the obligation to report Beneficial Ownership Information. 

  • Access the Tool:
    •Begin by accessing the FincenFetch Exemption Checker tool.
  • Enter Relevant Details:
    •Provide Information details about your business into the tool.

Starting the process of Beneficial Ownership Reporting may bring about a mix of emotions and anxiety. In these moments, the Exemption Tool becomes your ally, a source of comfort in the face of uncertainty. By entering some quick details, the tool cross-references them with the latest regulatory requirements, clearly indicating your filing status.

Beneficial Ownership Report Filing:

beneficial ownership report

Begin this learning adventure by scheduling a demo for Beneficial Ownership reporting.

This hands-on experience isn’t just about learning; it’s an empowering journey that boosts your confidence and ensures reporting becomes a quick and easy task. Discover how surprisingly simple and empowering Beneficial Ownership reporting can be with FincenFetch.

Charles Wismer
Charles Wismer

CEO at FincenFetch helping the U.S.professional services industry support FinCEN's new national security initiative to launch the Corporate Transparency Act. Prior fund manager and Fintech founder.

Charles Wismer
Charles Wismer

CEO at FincenFetch helping the U.S.professional services industry support FinCEN's new national security initiative to launch the Corporate Transparency Act. Prior fund manager and Fintech founder.

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