There is a new federal reporting requirement from FinCEN (the Financial Crimes Enforcement Network) that may apply to you if you own or control a private practice or other business (including having an LLC or PLLC that you use for 1099 work, locums, to hold a rental property, etc).

This requirement, called Beneficial Ownership Information (BOI) reporting, can be done online and must be completed by December 31, 2024.

What Is BOI Reporting?

As a part of the Corporate Transparency Act (CTA), the government is creating a database of companies and the humans behind them through BOI reporting. The law is part of an increasing effort to combat money laundering, tax evasion, and other financial crimes.

What Do You Need to Do?

1. Determine if this applies to you. If you own or control a business entity, like an LLC, corporation, or partnership, this likely applies.
2. Gather your information. You’ll need:
   • Business name, address, and EIN (Employer Identification Number)
   • Name, date of birth, address, Social Security number, and copy of Drivers License or Passport for yourself and any other owners (you can find FinCEN’s detailed list of requirements here).
3. File the report online. You can access FinCEN’s reporting portal and instructions here.

FAQs:

• Who has to file the BOI report? Businesses registered as LLCs, corporations, partnerships, or similar entities in the U.S. must file unless they meet certain exemptions (e.g., publicly traded companies). The report must be completed by December 31, 2024. Any new entities formed after January 1, 2025 will have 30 days to submit.

• What happens if I don’t file? Failure to file on time may result in significant fines or penalties, so it’s essential to act before December 31, 2024.

• What if I’m not sure if this applies to me? We recommend reaching out to your attorney or accountant to confirm your obligations. Virtually all small businesses are impacted, including single member LLCs which are common among physicians. However, sole proprietorships without a formal business entity are generally exempt. There are also some exceptions to the filing rule including charities, large companies with 20 or more employees and $5 million or more of revenue, and certain other businesses already subject to extensive government regulation (such as banks).

• How do I file the BOI report? You’ll submit your information through FinCEN’s online portal. Their website also provides step-by-step guidance.

• How long does it take? The time commitment to file can vary greatly depending on the complexity of business structure and ownership interests. For low complexity businesses such as single member LLCs, you can likely complete the report in less than an hour.

• Does this apply to my medical practice? If your practice operates as a formal entity (like an LLC, corporation, or partnership), it likely does. The practice will file one report listing all beneficial owners.

• What if a trust owns my LLC? Trust arrangements can vary greatly and specific facts and circumstances will determine who beneficial owners are when company ownership interests are controlled through a trust as part of an estate plan or asset protection plan. We recommend consulting your attorney for assistance.

• Are there any ongoing requirements? Going forward, reporting companies must report changes to any filing within 30 days of any change. If an owner or control person moves to a new address or has a name change as the result of marriage or divorce, an update will be required.

Take Action Now

If you’re unsure how to get started, we’re happy to connect you with trusted professionals who can assist you. We recommend completing this sooner rather than later so you are sure to meet the year end deadline.