FinCEN Reporting Deadline Extended
The Treasury Department has new filing and reporting requirements coming in 2024 and practitioners can help clients by making sure they’re informed and ready.
If you missed our previous articles detailing these new reporting requirements that will impact most small businesses, you can get more information here.
Originally, businesses only had a 30-day window to meet the filing deadline at the start of 2024. The majority of the reporting is centered around beneficial owner disclosures, especially for smaller businesses. Many small businesses will be subject to this reporting requirement that was enacted as part of expanded anti-money laundering laws.
Beneficial owners can be thought of as essentially the real owners of an entity. It is not uncommon for business structures to include multiple entities and layers. For example, owners of multiple rental properties may have a separate LLC to own each property with one corporate parent as the owner of all the individual LLCs. The beneficial owner of the LLCs in this example is the ultimate owner(s) of the corporation.
The reporting requirements provide for 23 exemptions, with accounting firms being included in the list. But most of your smaller business clients will not meet the exemptions and be required to file.
To gain more information and get a better understanding of what clients will be required to file, it is recommended that practitioners review the BOI Compliance page set up to help provide clarification on the reporting requirements and timing.
Reports will initially be able to be accepted starting January 1, 2024. The deadline for completing reporting has now been extended to 90, versus the original 30 days, making the reports due making the new due date March 31st.
Fines for failing to file could be as high as $10,000.
While this reporting is not a part of client tax returns, no doubt many small business clients will be unaware and caught off guard by the new reporting requirements. Practitioners can provide value-added support by communicating the new requirements to clients and disseminating the FinCEN information links.
Christine Gervais
Christine Gervais is a licensed CPA, using her skills to help businesses grow and achieve their fullest potential. Christine has a Master’s degree in accounting from Southern New Hampshire University in addition to holding her CPA license for over a decade. Notably, Christine is a nationally recognized speaker providing education to other CPAs on how to best serve clients as well as instruction on a wide variety of topics for business owners on how to maximize success. Christine prides herself on the value she can bring to clients with her extensive tax knowledge and providing strategic, forward-thinking financial strategies to help clients grow. When not behind her desk, you can find Christine spending quality time with her daughter and stepson or tending to the family’s excessively loved farm animals.