As of early 2025, U.S.-based companies and individuals are generally exempt from filing Beneficial Ownership Information (BOI) reports with FinCEN. The requirement primarily applies now to foreign entities registered to do business in the U.S. Additionally, 23 specific categories of entities, often already heavily regulated (e.g., banks, public companies, tax-exempt nonprofits, and large operating companies), are exempt.
All entities created in the United States — including those previously known as “domestic reporting companies” — and their beneficial owners are now exempt from the requirement to report beneficial ownership information (BOI) to the Financial Crimes Enforcement Network (FinCEN) under the Corporate Transparency Act (CTA ...
Summary. Under the CTA, an LLC (unless an exemption applies) is a “reporting company” that must file a beneficial ownership information report via the Beneficial Ownership Secure System (“BOSS”) interface and database.
On Friday March 21, 2025, the Financial Crimes Enforcement Network (FinCEN) issued an interim regulation that exempts U.S. small businesses and U.S. persons from the BOI reporting requirements. This means that America's small businesses will no longer have to file the burdensome BOI reports.
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Certain types of corporations, limited liability companies, and other similar entities created in or registered to do business in the United States must report information about their beneficial owners—the persons who ultimately own or control the company—to FinCEN as of Jan. 1, 2024.
Companies must update BOI reports within 30 days of ownership or structural changes. Changes requiring updates include new business names, addresses, and beneficial ownership details. Minor beneficial owners must have their information updated upon reaching legal adulthood.
There is NO fee to file BOI directly with FinCEN. FinCEN does NOT send correspondence requesting payment to file BOI. Do not send money in response to any mailing regarding filing your beneficial ownership information report that claims to be from FinCEN or another government agency.
In a nutshell, sole proprietorships do not have to file a BOI report to FinCEN. However, if your business takes off and you decide to form an LLC or a corporation, you'll be required to report your BOI.
What Does This Mean for U.S. Companies and Individuals? If your company is formed in the U.S., you are no longer subject to the CTA's BOI reporting requirements. U.S. persons who are beneficial owners of either domestic or foreign entities are not required to file BOI reports simply due to their ownership interest.
The largest drawback of operating a single-member LLC in California is the hefty $800 franchise tax, and additional LLC fees on high income brackets. According to Business Initiative, 10.34% of businesses in the United States are sole proprietorships.
Some LLC owners aren't required to pay themselves a salary or wages. Single-member LLCs, for example, typically pay themselves by taking money out of the LLC's profits as needed. This is called an owner's draw.
Update as of 03/02/2025: The Treasury Department has announced that it will it not enforce any penalties or fines associated with the beneficial ownership information reporting.
A non-beneficial owner often holds a share for someone else. Some common examples of non-beneficial owners include parents who hold shares for their children, the executor of a will who owns shares on behalf of an estate, or a trustee who holds shares for the beneficiaries of a trust.
If a nonprofit does not have 501(c) tax-exempt status, it is treated as a regular reporting company and must submit a BOI report.
For sole proprietors and other pass-through businesses, 2025's tax-free threshold is $15,000 for single filers and $30,000 for married couples filing jointly. C corporations will pay a flat tax rate of 21% for 2025. Small business owners with net income of $400 or more must pay self-employment tax.
A sole proprietor is someone who owns an unincorporated business by themselves. If you are the sole member of a domestic limited liability company (LLC) and elect to treat the LLC as a corporation, you are not a sole proprietor.
Companies formed in 2024 or after must file their BOI report even if they dissolve before their first report is due. The reporting requirement stands, regardless of whether the company ceases operations before the report deadline.
Register at CIPC. complete your Beneficial Ownership for Trusts for only R990 once-off.
Beware of Scams
Reporting beneficial ownership information is FREE. If you receive a solicitation requesting a filing fee for reporting beneficial ownership information, this is likely a scam. Bad actors are using the new reporting requirement to steal business owners' identities.
How often do these reports need to be made? The BOI report does not need to be renewed or updated unless there are changes to the information provided (e.g., a change in ownership or control). If there is a change to any of the information on the BOI report, an updated report must be filed within 30 days of the change.
An LLC can avoid double taxation by electing to be taxed as a pass-through entity. If the LLC has just one member, that owner can be taxed as either a disregarded entity ( and pay business tax on their individual return) or an S Corporation. Either will help them avoid double taxation.