A Comprehensive Guide for Real Estate Entities on Beneficial Ownership Reporting (BOI)

In the real estate industry, it can be difficult navigating regulatory changes and staying compliant. The beginning of 2024 ushered in a significant regulatory change that affects numerous stakeholders in the real estate sector.

The introduction of the Beneficial Ownership Information (BOI) reporting requirement under the Corporate Transparency Act (CTA) marks an important shift in how real estate entities operate, highlighting the government’s increased efforts to combat financial crimes. This guide is meant to help both small and large business owners in the real estate industry, navigating the complexities of this new federal reporting requirement.

Do real estate companies have to file a Beneficial Ownership Information (BOI) report?

The Corporate Transparency Act mandates that certain legal entities, including LLCs, corporations, and similar structures involved in the real estate realm, report beneficial ownership information to the Financial Crimes Enforcement Network (FinCEN), a division of the Department of Treasury.

This directive primarily targets “reporting companies” which includes a broad spectrum of entities within the real estate industry. This includes brokers, developers, investment groups, and private property holding entities, among others.

Do Real Estate Companies fall under the 23 CTA exemptions?

If you’ve established an LLC, corporation, or another entity for your real estate business by filing with a secretary of state (or an equivalent office) or registered it to do business in the U.S. from abroad, you’re likely required to file a BOI report.

However, it’s crucial to examine the CTA’s 23 exemptions to determine if your entity might be excluded.

Keep in mind that while the parent real estate company may be large enough to qualify for exemption, the subsidiary property holding LLCs do not share this status and may need to file BOI reports.

What do real estate companies have to report to FinCEN under the Corporate Transparency Act?

Entities obligated to file must furnish detailed information about both the company and each beneficial owner. For the company, this includes legal and trade names, the principal place of business, jurisdiction of formation, and taxpayer identification number.

Beneficial owners’ details encompass legal name, date of birth, residential address, and identifying documentation. Notably, for entities established or registered starting January 1, 2024, information required for beneficial owners must also be provided for the company applicants, however it can be with business addresses instead of residential ones.

When will my real estate business have to file its BOI report to FinCEN?

The CTA defines a beneficial owner as any individual that directly or indirectly, exerts substantial control over the company or holds a minimum of 25% ownership interest. Company applicants include those who file the entity’s creation or registration documents and those primarily responsible for overseeing this filing process.

BOI Report Filing Timeline

Companies created or registered to do business in the United States before January 1, 2024 have to report by January 1, 2025.

Companies that were established or registered between January 1, 2024, and December 31, 2024, are granted 90 calendar days following either actual notice or public announcement of their business establishment or registration becoming effective to submit their initial Beneficial Ownership Information (BOI) reports.

For companies established or registered starting January 1, 2025, they will have a 30-calendar day period from the receipt of either actual notice or public announcement that their establishment or registration is valid to file their initial BOI reports.

How do I file a BOI report for my real estate company and what are the fees?

Filing is conducted electronically through FinCEN’s platform, with no associated fee. This approach underscores the government’s commitment to streamlining compliance processes while ensuring the accessibility of these crucial regulatory submissions.

However, if you have many entities, here at Platinum Filings we recommend using our BOI Manager to easily manage any updates that may require you to file again.

Timeline for Submitting BOI Reports

For companies formed or registered to conduct business in the United States prior to January 1, 2024, the deadline to submit their initial reports is January 1, 2025.

Companies established or registered within the year spanning January 1, 2024, to December 31, 2024, are allotted 90 days from the date of actual notice or the public declaration of their business’s establishment or registration to submit their initial Beneficial Ownership Information (BOI) reports.

Beginning January 1, 2025, companies that are established or registered will be given a 30-day window starting from the receipt of actual notice or the public announcement confirming their establishment or registration to file their initial BOI reports.

The CTA and Filing a BOI report as a real estate company:

By familiarizing themselves with these new regulations, real estate business owners can ensure compliance, thus avoiding severe penalties, including financial fines and imprisonment. As for real estate and compliance, staying informed and prepared is more crucial than ever.

Still have questions?

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