If you’re a small business owner with an LLC, you’ve probably got a million things on your plate—from managing your business finances, payroll, and tax obligations. Well, here’s one more critical task: FinCen (Financial Crimes Enforcement Network) now requires business owners to register their companies starting January 1, 2024. Don’t worry—I’ve got you covered. In this post, I’ll break down:

• What FinCen registration is
• Who needs to register
• How to file your registration
• The penalties for failing to comply

What is the FinCen Registration Requirement?

In 2021, Congress passed the Corporate Transparency Act to combat illegal activities conducted through business entities, often referred to as “bad actors” (and no, we’re not talking about Hollywood). Essentially, the law makes it easier for the government to track who is behind an LLC or corporation—who owns it, and who benefits from it. This is a big step toward increasing business transparency.

Who Needs to Register?

So, who exactly needs to file? The law applies to all domestic reporting companies—which is a fancy way of saying any corporation, LLC, or other entities created by filing with a state office in the U.S. Even foreign companies doing business in the U.S. must register with FinCen.

For clarity, I’ve included a flowchart below from the official FinCen website. Take a look to see if your business qualifies.

Are There Any Exemptions?

Yes! There are 23 exemptions, mostly covering financial institutions like banks, insurance companies, and other similar businesses. Check the full list here to see if you’re exempt.

How to Register with FinCen?

Here’s the good news: Filing your Business Ownership Information (BOI) with FinCen is FREE. Yes, you read that right. However, some third-party companies may try to charge you for doing the same thing, so be aware of that. Want to know how to file it yourself? Stay tuned for my next blog, where I’ll walk you through the process, step by step.

Deadlines You Shouldn’t Miss

Here are the key dates you need to know:

• If your business was created before January 1, 2024, you have until December 31, 2024, to file.
• If your business was formed after January 1, 2024, you only have 90 calendar days from the time your business was created to register with FinCen.

What Happens If You Don’t File?

This is where things get serious. If you fail to register, the penalties are steep. You’ll face a daily fine of $591 (adjusted for inflation) and up to two years in prison. On top of that, there’s a maximum fine of $10,000. Trust me—you don’t want to risk this.

What’s Next?

If you’ve got more questions, reach out to us, or watch my next video where I’ll break down the registration process for you.