What Your CPA Wants You to Know
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What Your CPA Wants You to Know
89. BOI Report: Important Legal Updates and Filing Tips!
Please note: There is a temporary pause in enforcement of the BOI Report filing following a significant court ruling this month. Though we do think the BOI report will eventually need to be filed at some point.
This episode walks you through how to file your BOI report on the FINCEN website if you have not yet filed!
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So since recording this episode that is airing today, there have been some tax law changes. So we love when that happens. We have been preparing for the BOI reports all year, filing a bunch of them, and then now they are changing the law. So there was a Texas court judge who said okay, this BOI reporting is unconstitutional. Who said, okay, this BOI reporting is unconstitutional. So what that means is that the BOI reporting requirements have been affected by that and that federal court order. So right now there's a halt and that filing is not going to be due. That just means that if you don't file it, you're not going to be punished and we just have to wait and see what happens. So a couple of thoughts on this. Yes, the law's changed, but they have actually already appealed that order. So there's going to be a lot of changes with this and very likely we're still going to have to file the BOI report. So, number one it just won't be due on December 31st.
Speaker 1:And the second thing that people are concerned about is that they don't want to submit this information to the government, and I totally get that. We are Texans, we like our freedom and we don't like the government to be in our business. But this one thing is kind of silly, just because they already have this information. The report is very simple. You're submitting your EIN, your address, your name, all of that, and that's something that's already on your tax return. So if that's something that you're worried about, I mean it's not really anything that the federal government doesn't already have. We do understand that this has been such a pain in the butt for most people. Whenever they all of a sudden say, okay, here's a new filing requirement and then, like all of the clients that have paid us to do it because they didn't want to do it and didn't want to take time out of their day to do it, now they're like, oh, we don't have to. So we absolutely agree that they shouldn't be putting more work on business owners. So hopefully we don't have to end up filing this, but we do think that that is very likely that you're still going to have to file the BOI report.
Speaker 1:The next thing is that you can still file it online. We're still finishing up some for clients just saying like, hey, we were getting to yours. Here's what's happening. Do you still want to file? A lot of people said, yeah, let's just go ahead and file it and just check it off my to-do list. So if you do want to still file your BOI, this episode will be perfect for you because I am just walking you through how to do it, so you can sit down at your computer and go through all the steps with me so that you know you're doing it right and just know it's a pretty simple and easy, very quick filing. So if you're like that, you don't have to worry about it next year, you don't have to worry about keeping up with all of the updates as it goes through all the court cases, and you can still go ahead and file. It's still online and I'm going to walk you through that today. I think a lot of people are scared to do this filing themselves, but it's really a simple filing.
Speaker 2:Welcome to what your CPA Wants you To Know.
Speaker 1: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.
Speaker 2:I'm Carson Sands.
Speaker 1:And I'm Taryn Sands.
Speaker 2:I'm a CPA with over 10 years of experience helping people start and grow their businesses.
Speaker 1: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. Taxes suck and we want to make sure you don't pay more than your fair share.
Speaker 2:We're here to share everything your CPA wants you to know.
Speaker 1:In a fun and easy to understand way.
Speaker 2:Let's get started.
Speaker 1:Let's do it. Hello, today you have just me for a little bit of a different episode than what we typically do, so I am going to actually walk you through filing your BOI report if you have not done that report yet. So if you haven't heard about this report and I'm actually surprised by the number of people who still have not heard about it because the penalties for not filing are so severe Hopefully you have heard about it, but you have plenty of time and that's what this episode is all about. The BOI report is for any LLC. So if you filed an LLC with your state, this BOI report, which stands for Beneficial Ownership Information Reporting it is just a new report created by the federal government that all LLCs need to file. So a couple things to know here. One, it's a brand new report. You've never filed this. Even if you've had an LLC for 20 years, you've never had to file this. So this is new. Two, generally, states only report certain LLC requirements to the state because you set your LLC up with a state. So this is a new thing where they're gathering information for all the LLCs. I'm not going to go into why we think they're doing this or what they're stating. It's for just the fact that you need to file it, and it has to be filed by December 31st. So this is very time sensitive.
Speaker 1:The other thing to know is that there are severe penalties with this new filing if you don't file. So it's thousands of dollars if you miss this filing. I don't know how they're going to assess that how quickly, anything like that. This is all new, but they do state that the non-filing penalties will be very high. Another thing to note is that you should not have to file this yearly. Thankfully, this is just a one-time filing. The only thing you would need to do is go in and file an update if anything with the ownership changes. So if you change owners or something like that, you could go in there and file an update. But, as for now, all LLCs that were established before 2024 need to file their BOI report by the end of 2024, so that you don't get those penalties. Now your CPA can do this for you.
Speaker 1:We've had a lot of clients want us to do the report, but I'm telling you that is very simple. If you can just sit down and go through this episode, so listen to the episode while you're doing the report, it'll be super simple for you to do. What you're going to need is a driver's license for every single owner. Also, if you have a single member LLC in a state that's a community property state, like Texas, for instance, then you'll also be needing the driver's license for the spouse. Because it's a community property state, they are requiring that the spouse also be included as a beneficial owner, even if they're not listed on the LLC paperwork.
Speaker 1:So, step one, you're going to make sure you have those driver's license and then you're going to get on your computer and go to finsongov. That's f-i-n-c-e-n dot g-o-v. Want to go to any of the websites that pop up that are like spam websites. You always want to make sure that you're going to the one that ends in GOV when you're doing filings. Whenever I pull this up, there's so many like scams that come up, so I always just tell clients to make sure you're going to the gov website. So you're going to go to finsongov and then you'll navigate to the BOI. So it's finsongov, slash BOI.
Speaker 1:Once you're there, you're going to see a screen that says beneficial ownership information and you can either go to the blue box that says prepare or file. So you want to click on file a report using the BOI e-filing system. Then you'll come to a page that says welcome to the BOI e-filing system and then there's two little buttons that say get started and the BSA e-filing system. You want to click under the beneficial ownership information reporting. Click get started. Then you're going to scroll down. There's three little boxes. You want to go to the file online BOIR and click the button that says prepare and submit BOIR. This is saying that you want to do it online. You don't want to mail in a paper copy of the BOI. Then there's a warning that pops up. You're entering US government information and it's going to be monitored while you're using it. All of that. Just click agree on that button.
Speaker 1:Okay, so this is where you're going to actually start the filing. So page one is pretty simple. You're just going to click initial filing, so you wouldn't click anything else unless you're actually updating it, and I would assume anyone listening to this is only filing their initial report. So, type of filing click A for initial report and then you're going to click next. Now this is the part on part one, reporting company information, that people are getting confused. You do not need to request to receive a FinCEN ID. You can just skip over that part.
Speaker 1:You're going to go to the first number, number five, that has the star by it, meaning you have to put in that information. So you're going to put in the company legal name. So what did you file the LLC name as. Put that in there. And then you have to scroll down to number seven, which is the next number with the star beside it, and you're going to put the tax identification number in here. So on this you can either use an EIN, if your LLC has an EIN so if you're a partnership or an S-corp, anything like that, that requires an EIN, you would have that or even if you're a sole proprietor and you did get an EIN, but if you do not have an EIN, you can also use your social security number, which would be for sole proprietorships. So that would be number seven. Click which type you're using and, number eight, put in that number in the tax identification number. And then you're going to scroll down to the country of formation the United States and keep scrolling to number 11. That's where you're going to put in the address, city, state and zip code of the LLC. So that first page is pretty simple, just putting in the name of the LLC, the type of tax identification number you use in EIN or social security number, and the address. Then you're going to click next.
Speaker 1:This is another tricky part of the VOI, tricky part of the BOI. And if you had an LLC before 2024, so this only applies to LLCs that were formed before January 1st of 2024. So if that doesn't apply to you and you had a new LLC this year, then you have a different due date. You still need to file this report, but your report is due sooner. So this applies to all of the old LLCs before they made this. So that means you're gonna have. So that means you are an existing reporting company. So you can see on number 16, right after it says existing reporting company that you need to check if you're existing reporting company as of January 1st 2024.
Speaker 1:So, like I said, if you have your LLC established before 2024, you're going to be clicking that box. So you want to click box number 16. And then a box will pop up that says attention, this page will be disabled. If you are an existing company, you're going to say yes. What that does is it doesn't make you fill in the company applicant. So you're going to skip to the next tab because all of that will be grayed out where you can't type anything in, and you're going to go to the beneficial owner information, part three tab.
Speaker 1:So on this it's really simple. So you're just going to fill in all the blocks where there's a star. You're going to scroll down to number 38, where you start with the last name first name, date of birth, address and then at the bottom of the page you're going to put in that identifying document so it can be a passport or the driver's license. So if you don't have the driver's license, like I mentioned before, you can use a passport. So you can put in the ID type on 4849. You're going to put in that number, the document number for the ID, and then put in the address that's listed on there. So fill all of that in and then, on number 51, you're going to upload the image of that ID. So if you have a driver's license or the passport, you need an image in there.
Speaker 1:So once you upload that, if you need to add another beneficial owner which I had to do a lot you have to scroll to the top of that page and click add beneficial owner. Then it will pop to a next box that says beneficial owner number two. So however many owners you need to add on there, that's the way you do it, because if you move on to the next page and click next, it's not going to let you add a beneficial owner. The good thing is at the bottom of the screen you can go between pages, clicking next or previous, pretty easily and it doesn't mess anything up. So their system is pretty good on that.
Speaker 1:So once you have all of your beneficial owner information in there for each owner and then you have everything uploaded for the documents for their IDs, you want to go next at the bottom of the screen, which will take you to the submit page, and then scroll up to the top of the submit page so that you can see where you need to put in your email, your first name, your last name, and then you have to click agree. So once you do that, it's going to have a little place where you have to confirm that you're human and once you do that, you click submit B-O-I-R. So it's going to take you to a landing page that says wait right here, make sure that this processes. Once it does, it's going to give you the option to download your transcript. So make sure that you download that so that you have a copy of your BOI that you submitted and confirmation that you did. You should also get an email with this information. Just make sure you save that in case you need it. So it doesn't take too long to fill this out and it's pretty easy.
Speaker 1:So I just wanted to walk you through it. This will be a good episode that we can also send our clients who haven't filed yet. But you have about a month to get that filed. Make sure you do that. Hopefully, this was helpful. I think a lot of people are scared to do this filing themselves, but it's really a simple filing and if you enjoyed this episode, please, please, please share it with a friend, share it on your social media or please send us a message, a DM, telling us what you liked about it. We really love to get feedback on the episodes and until next time. Thank you so much for listening to what your CPA Wants you to Know. Podcast. Bye.