US Companies Exempt from BOI Reporting
The flurry of activity around the Beneficial Ownership Information (BOI) reporting rules has been difficult to follow. After several court rulings in February that allowed the reporting requirement to stay in place, the Department of the Treasury announced (FIN-2025-CTA1) a new March 21st reporting deadline. Within a few days, another release was issued announcing relief from penalties for those who failed to meet the March deadline. It also stated that U.S. companies and beneficial owners will be exempt from the requirement henceforth, pending the publication of an interim final rule.
Earlier this month, the interim final rule was issued, outlining several important changes. As expected, the requirement for U.S. persons and businesses to comply with BOI reporting rules has been removed. It also outlined several changes including updated definitions for reporting companies, beneficial owners, and what steps foreign entities must follow to comply. It also outlines when companies must file the required report. To help clients, prospects, and others, Klatzkin has provided a summary of the key details below.
New BOI Reporting Changes
The interim final rule changes the definition of a “reporting company” to mean those entities created under foreign laws and registered to conduct operations in the U.S. This includes those that have registered in any state or tribal jurisdiction by completing the necessary paperwork with the secretary of state or other office. There is a new exemption for domestic reporting companies. In other words, any entity created in the U.S. and its beneficial owners do not have to comply with this requirement.
Foreign reporting companies that satisfy eligibility criteria and are not eligible for an exemption must file a BOI report. Foreign reporting companies are not required to disclose any information on U.S. beneficial owners. In addition, U.S. persons are no longer required to report information on any entity in which they may be a beneficial owner. Finally, no fines or penalties will be pursued or assessed against any U.S. company or beneficial owner for non-compliance.
New Reporting Deadline
Foreign entities registered to do business in the U.S. before the date of publication of the interim rule must file no later than 30 days from that date. Those registered to do business in the U.S. on or after publication of the interim rule have 30 days to file an initial report (after receiving confirmation the registration is effective). There are certain exceptions for those who were victims of various natural disasters. Finally, it is important to note fines and penalties will be assessed for failure to comply.
Contact Us
The change to the BOI filing requirement is welcome news for many U.S. companies and their owners. However, for foreign companies the requirement remains. If you have questions about the information outlined above or need assistance with another tax or accounting issue, Klatzkin can help. For additional information call 609-989-9189 or click here to contact us. We look forward to speaking with you soon.