BOI compliance for LLCs managed by accountants

Executive summary (what changed and current status) - As of the March 26, 2025 interim final rule, FinCEN removed the BOI reporting requirement for entities created in the United States (previously called domestic reporting companies). In short: U.S.-formed LLCs and their U.S. beneficial owners are generally exempt from FinCEN BOI reporting under the interim rule. Reporting companies under the revised rule are foreign-formed entities that have registered to do business in a U.S. State or Tribal jurisdiction. (See FinCEN primary sources below). Who (still) must file BOI to FinCEN - Foreign entities formed under the law of a non-U.S. jurisdiction that have registered to do business in a U.S. State or Tribal jurisdiction (and that do not otherwise qualify for one of FinCEN’s exemptions) must file BOI. These foreign reporting companies follow the filing deadlines set out by FinCEN (30 days in the principal timelines described below). Domestic U.S. entities are exempt per the interim final rule—verify status before filing in case of future regulatory change. Deadlines and timing (practical application) - For foreign reporting companies registered to do business in the U.S. before March 26, 2025: FinCEN’s guidance set a near-term deadline (for many companies the guidance referenced April 25, 2025). For any foreign entity that becomes a reporting company on or after the IFR publication date, the rule requires BOI filing within 30 calendar days after receiving notice that their registration is effective. Always verify current published deadlines with FinCEN. - Corrections and updates: When reported information changes, filers must submit an updated BOI report within the timeframe required by FinCEN (the rule includes 30-day update periods for many changes). FinCEN also provides a voluntary correction safe harbor if an inaccurate report is corrected promptly (the Small Entity Compliance Guide references a 90-day voluntary correction safe harbor in certain contexts). What information is required (for each beneficial owner and company applicant) - For each beneficial owner (or company applicant, where applicable), FinCEN requires: - Full legal name - Date of birth - Current/residential address - A unique identifying number from an acceptable, non-expired identity document (U.S. driver’s license, state/local ID, U.S. passport; if none available, a foreign passport) and the issuing jurisdiction - An image of the identifying document - FinCEN offers optional FinCEN identifiers (FinCEN IDs) that individuals may request; a reporting company may report a person’s FinCEN ID instead of the usual personal data if one exists. Obtaining a FinCEN ID is optional and can streamline repeat filings. Role of accountants and practical steps for firms - Who can file: Anyone the reporting company authorizes may file (owners, employees, or third-party service providers such as accountants). The filer must certify the accuracy of the report. - Are accountants beneficial owners? Generally no—accountants and lawyers providing ordinary arms-length professional services are not treated as beneficial owners under FinCEN because those roles do not ordinarily constitute “substantial control.” However, exercise care: if a professional holds a role equivalent to a senior officer (e.g., general counsel) or otherwise exercises substantial control, that person may meet the beneficial-owner definition. - Services firms can (and many do) offer BOI filing services. AICPA and state CPA societies provide resources, templates, and suggested engagement-letter language. Before offering services, firms should: 1. Decide and document the scope (initial filings only, updates, corrections, monitoring). Use a separate engagement letter or clearly add language to existing engagement letters describing responsibilities and client deliverables (who must supply IDs, who certifies accuracy, turnaround times, fees). 2. Obtain client-signed authorization to file on the company’s behalf and to collect required ID images and personal data. 3. Collect a standardized intake package: entity legal name, trade names, EIN/TIN, formation jurisdiction, state registration details, list of beneficial owners and supporting ID documents (images), and any exempt-entity chains if applicable. 4. Verify identity documents and keep secure copies consistent with firm privacy/security standards. Consider secure file transfer and encrypted storage. If you obtain FinCEN IDs on behalf of individuals, follow FinCEN ID application steps and documentation requirements. 5. Maintain retention and documentation policies—store copies of submitted BOI reports, client authorization, engagement letters, and evidence of client-supplied data for your professional file and in case of audit or client dispute. 6. Manage malpractice/liability risk: consult your firm’s professional liability carrier re: BOI services; use narrowly tailored engagement terms; consider requiring clients to indemnify the firm for false client-supplied information; obtain consent language for sharing sensitive ID images; and consult counsel on possible unauthorized-practice-of-law concerns for complex legal questions. State-level filing and privacy considerations (what accountants should warn LLC clients about) - State filings and public records vary: some states require member/manager disclosures in filings that are public. Examples: - California: LLCs must file a Statement of Information (Form LLC-12) within 90 days after formation; that filing requires member/manager information and becomes public record. Consider using a commercial registered agent or business address to reduce exposure of home addresses. (State-level privacy mitigation steps differ by state.) - Texas: The Public Information Report and franchise-related filings can list managers/members; state systems (PIR) may be publicly accessible and shared with the Secretary of State. Check the Texas Comptroller and SOS guidance for specifics. - Delaware and some other states typically do not list members on the public formation documents (Delaware often records organizers/managers but not necessarily members). State rules differ—always check the target state’s Secretary of State and Comptroller guidance. - Practical guidance: advise clients on the difference between FinCEN reporting (federal BOI database, now narrowed) and state public records. Use registered-agent services, business addresses, and careful drafting of operating agreements to reduce public exposure of personal addresses. Practical checklist for accountants helping LLC clients (action items) 1. Confirm whether the LLC is actually a “reporting company” under current FinCEN guidance (post-March 26, 2025: most U.S.-formed LLCs will be exempt). If foreign-formed and registered in a U.S. state/tribe, proceed to step 2. 2. If filing required: assemble entity data, beneficial owner lists, ID images, and company applicant info; obtain client authorization; prepare and file via FinCEN BOI E-Filing system or third-party vendor. 3. If client is exempt: document the determination in the client file and advise client to notify you if circumstances change (e.g., acquisition, change in status, foreign registration). 4. Offer to obtain FinCEN IDs for repetitive filers where beneficial. 5. Update filings and file corrections per FinCEN timelines; observe safe-harbor guidance for voluntary corrections. 6. Keep clients informed about state-level public-record exposures and recommend privacy mitigation where appropriate. Where to get authoritative, up-to-date information - FinCEN (BOI landing page, FAQs, Small Entity Compliance Guide, BOIR Filing Instructions, FinCEN ID instructions) and the AICPA BOI resource center are the authoritative practitioner sources. Because policy remains subject to change, confirm FinCEN’s current rulemaking and the AICPA guidance before taking action. Bottom line for U.S. business owners and LLC founders - If your LLC was formed in the U.S., it is generally exempt from FinCEN BOI reporting under the March 2025 interim final rule, but you should confirm this based on your entity’s precise facts and any new regulatory updates. If your company is foreign-formed and registered in the U.S., beneficial ownership reporting to FinCEN may still be required and should be handled carefully—accountants can assist, but must use well-drafted engagement letters, collect and secure identity documents, and follow FinCEN’s required data fields and deadlines. Caveat: The regulatory picture for BOI has changed significantly. Always verify the latest FinCEN rules and AICPA guidance before filing or advising clients.