What Your CPA Wants You to Know
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What Your CPA Wants You to Know
72. All LLC Owners MUST File This *NEW* Federal Report! Here's What You Need to Know About The BOI!
Have you heard of the new Beneficial Ownership Information Report that must be filed by all LLC owners in the U.S?!? This is the first year it is required and it is due quickly if you filed a NEW LLC in 2024. It's due by the end of the year if you file for an LLC established before 2024!
In this episode we explain what this new BOI report is and help you understand everything from the filing process on the FinCEN website to the substantial penalties that will be assessed if you forget(!).
We lay out all the info you need to meet the critical deadlines and explain when you might need to refile. This episode is SO important for all LLC owners! Send this to everyone you know who has an LLC!
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when you set up a new LLC. That's all public information, and so all these corporations and scam companies get that information, start sending you letters that you have to file this report and we'll do it for you, and you only have to pay us $150 a year for the rest of time, and that's completely unnecessary. Welcome to what your CPA Wants you To Know.
Speaker 2:Tax and accounting help can be expensive, so we've created this podcast to help guide you through it all and make you feel like you have a CPA in your back pocket. I'm Carson Sands and I'm Taryn Sands.
Speaker 1:I'm a CPA with over 10 years of experience helping people start and grow their businesses.
Speaker 2:And I'm an MBA with a specialization in marketing and entrepreneurship. Taxes suck and we want to make sure you don't pay more than your fair share.
Speaker 1:We're here to share everything your CPA wants you to know.
Speaker 2:In a fun and easy to understand way.
Speaker 1:Let's get started.
Speaker 2:Let's do it. Today's episode is very, very important if you own an llc. If you have not heard and you've been living under a rock, there is a new filing requirement for anyone who owns an llc in the united states, and it's a federal requirement called the boI report.
Speaker 1:That stands for Beneficial Ownership Information Report.
Speaker 2:This is something we had an episode on last year, but we wanted to update everyone again because it has to be filed at some point before 2025. So this is a time tax season's over. You want to make sure, if you have an LLC, or more than one LLC, that you file a BOI for each LLC. Today we're going to break it down for you. They have a little bit more information out than when we did the previous episode and just a friendly reminder if you have one or you know somebody that has an LLC, you definitely want to make sure to get this filed, because the penalties for this are very high.
Speaker 1:It's very easy to do. That's why you definitely want to do it, because it's so easy. But if you don't do it, it's just a huge penalty, a huge inconvenience for you long term.
Speaker 2:Yes, you don't want to pay the penalty because it's free to file this and you're not paying any money. This is not a tax. This is just information that they're gathering. So this is a federal report. They want everybody to go online and file this report for their LLC so they can gather information about all of the owners. Now we won't go into all the details on why they're doing this, because it's very boring, but it has to be done and, like Carson said, it's very easy.
Speaker 2:We've had clients already go ahead and do this, get that off of their to-do list, and they've come back saying, yeah, it was super simple, I did it online very quickly. So it is something you can do. I'm sure, like us, your CPA will probably offer this service for anyone that wants to, but we're telling all of our clients to just try it, because I hate charging people a lot of money to do something that they could do very easily, and we have no expertise in this. It's just data entry. So, to file this step one, you're going to go to the Finson website, so type in Finson, you're going to see the BOI report on there and you just get started. The information that you're going to need is all of the owners on the LLC and you're going to need some sort of identification. Most people have been using their driver's license, so you're just inputting all that information and it's a very quick and easy thing to do. So we mentioned earlier the due date. There are a couple of due dates, so listen closely.
Speaker 1:There's three different due dates. Potentially, the first one is for anybody that already had their LLC before 2024 started. If you registered and set up that LLC before that, you need to have the BOI report filed by the end of this year. December 31st of 2024 is the final deadline for you. The next deadline is the 90-day deadline. That's a temporary deadline they have for people that set up new LLCs this year, just to give everybody a little bit more time because this is a new thing. If you set up an LLC early in this year, then you need to have that BOI report filed within 90 days of registering that LLC. But the main rule going forward for all the new LLCs at what point do you know at what point they cut it off?
Speaker 2:I believe, next year and moving forward, that 90 days is going to change to 30.
Speaker 1:So at that point, as soon as you set up the LLC, you might as well go ahead and just do the BOI report as soon as possible, but you have 30 days to get it done after the LLC is set up.
Speaker 2:They're just giving that 90-day leeway for this first year, since this is a new filing. So I set up all of our LLCs and I set up some like January 5th, so instead of filing by the end of the year, that person had to file within 90 days. So we had to make sure to get that filed really quickly. So that's going to be even quicker in 2025. If you set up any new LLCs which a lot of our clients set up new ones all the time for different things you're going to need to file that pretty much immediately to avoid the penalties.
Speaker 1:This is also important. This is something you will likely only have to avoid the penalties. This is also important. This is something you will likely only have to file one time. Now you do have to go and update it and file again. If something in the ownership information changes, that could be a change of owner, whether you sell the LLC or whether you add an owner or an owner dies or something like that. Those are some of the options. Or even if it's something else, like addresses or different things like that, you might need to update it for that. But other than that, if nothing changes in the ownership structure, then you don't have to file this every single year.
Speaker 2:Yes, that was not very clear when they first released this new report. It was is it going to be a yearly filing or what? But now that we've seen clients do it and we've actually seen the filing website, there is an option to file your initial report so you would click on that if you've never filed or to file an update, and you would only have to file again if something changes. So it really is just this one year, unless you either set up a new LLC or something changes. So that's actually the good news for all of this.
Speaker 1:Something else you should know is that when you set up your LLC, whatever software you go through, if you don't go through your tax preparer or a lawyer, then they will probably have the option for an extra fee to do the BOI report for you.
Speaker 1:As long as it's a one-time fee and it's $150 or something like that, that's pretty reasonable.
Speaker 1:If you wanna go ahead and pay that, even though it's free for you to do it on the FinCEN website if you just wanna pay while you're doing the LLC so that it will be taken care of as part of the process they already have all your information because you just put it in to set up the LLC then that's okay. But under no circumstances should you ever commit to any ongoing fees for this an annual fee, a monthly fee, whether it's through the company you set up your LLC through or whether it's through some scam thing that they mail you. Because when you set up a new LLC, that's all public information and so all these corporations and scam companies get that information, start sending you letters that you have to file this report and we'll do it for you and you only have to pay us $150 a year for the rest of time. And that's completely unnecessary because you only have to file it one time and you don't need to pay some scam company every year for no purpose.
Speaker 2:Yeah, legalzoom is really good at that. They're always charging our clients registered agent fee for life, which is just ridiculous. So definitely do not sign up for anything like this. It's really easy. We are urging everyone to do it themselves. I did see that LegalZoom is charging $149 to file it for anyone, so if you don't want to do it, that's completely fine. That's the price. We're also charging $150 for our clients, but just telling everybody just try it, it's so quick and easy. We just want to make sure everybody gets that filed so that no one's paying these outrageous penalties because they're making the penalties very high on this thing that you have to file whenever there's not even any taxes owed.
Speaker 1:I think it's going to be one of those things where it's not enforced that strongly, but whenever somebody irritates them or is doing something else illegal and then they mess this up, then this is a way that they can go in and punish them harshly. But that doesn't mean they won't come after you, even if you're completely innocent of anything else, for not filing it.
Speaker 2:So that's true. Well, that is all we have today is just this quick reminder to get those BOI reports filed, letting you know that you are absolutely capable of doing it. Just make sure that is on your radar and that you know when your due date is. Also, if you have multiple LLCs, to make sure to file one for every LLC that you own.
Speaker 1:Well, that's it, so thank you so much for listening to.
Speaker 2:What.
Speaker 1:Your CPA Wants you To Know Podcast. This podcast is intended to provide accounting and tax information for educational purposes only. All tax situations are unique and should be handled with the assistance of a tax professional.