Chattanooga has a thriving small business community and we at RockPointBank want to ensure the continued success of our local economy. This includes alerting you to new regulations and business filing requirements. As of this year, many small businesses are required to file beneficial ownership reports with the Financial Crimes Enforcement Network (FinCEN). The purpose of this new legislation is to keep record of the real people who own these companies, i.e. the beneficial owners, and curb illicit finance. The intention is to eliminate the pseudo-businesses currently making it more difficult for small, locally owned businesses (i.e. businesses owned by real people who actually care about their communities) to thrive. Filing correctly and in a timely manner is important to the continuation of your business. Here is what you need to know:
Who Needs To File?
Companies falling under the following categories must report beneficial ownership information to FinCEN:
- A corporation, a limited liability company (LLC), or was otherwise created in the United States by filing a document with a secretary of state or any similar office under the law of a state or Indian tribe; or
- A foreign company that was registered to do business in any U.S. state or Indian tribe by such a filing.
Learn more about qualifying companies here.
When is the Deadline?
- Reporting companies created or registered before January 1, 2024, have until January 1, 2025, to file.
- Reporting companies created or registered in 2024 must file within 90 calendar days after receiving actual or public notice that their creation or registration is effective, whichever is earlier.
- Reporting companies created or registered on or after January 1, 2025, must file within 30 calendar days after receiving actual or public notice that their creation or registration is effective.
- Any updates or corrections to beneficial ownership information previously filed with FinCEN must be submitted within 30 days.
How Often Do I Need To File?
FinCEN does not require annual filing. A report may be filed once unless information needs to be updated or altered.
Where Can I File?
The FinCEN website has made filing available online. You can learn more and file directly here.
What Happens If My Company Doesn’t File?
Willfully violating FinCEN reporting requirements may subject a business owner to civil penalties. According to the FinCEN website, these penalties include fines of up to $591 for each day the violation continues, as well as criminal penalties of up to two years imprisonment and a fine of up to $10,000.
Though few are excited for more paperwork, we hope that this one time filing with FinCEN will ultimately benefit legitimate small businesses and encourage our local economy to flourish.