BENEFICIAL OWNERSHIP INFORMATION REPORTING (BOIR) AND CENTRAL FLORIDA RENTAL PROPERTIES
As of January 1, 2024, the Corporate Transparency Act (CTA) has introduced new federal reporting requirements for certain business entities, including many involved in the property management industry. Some investors prefer to transfer real estate ownership to their companies. If you own an LLC, corporation, or other legal entity associated with your rental property, understanding these requirements is essential to avoid penalties. If you miss the BOIR filing deadline, you could face serious repercussions, including Source:
- Civil Penalties: fines are up to $591 per day for late filing of the report
- Additionally, there are Criminal Penalties which can result in imprisonment of up to 2 years and fines of up to $10,000.
Our Orlando property management office has prepared this guide to help. Let’s determine whether you need to file a BOIR with the Financial Crimes Enforcement Network (FinCEN) and provide an overview of the process.
Does My Real Estate Company Have to File a BOI Report?
If your company was created by filing documents with a secretary of state or equivalent office in the U.S. (or registered to do business in the U.S. as a foreign entity), it is likely subject to the reporting requirement. A real estate LLC formed to manage rental properties must file unless exempt.
Some entities are exempt from filing under the CTA. For example: Securities reporting issuer, Governmental authority, Bank, Credit union, and etc. Important, tax-exempt entity are exempt from filing. Please see full list here.
If you’re unsure whether your company qualifies for an exemption, consult the official list of CTA exemptions or a legal professional.
How to File the BOIR
FinCEN’s secure online portal is the most convenient way to file. As today, there is no filing fee.
What Information Needs to Be Reported?
If your company is required to file, here’s the information FinCEN requires:
About Your Company:
- Legal name
- Trade names or DBAs
- Principal business address
- Jurisdiction of formation or registration
- Taxpayer Identification Number (TIN)
About Beneficial Owners:
- Legal name
- Date of birth
- Residential address
- Identification document (e.g., passport or driver’s license) and an image of the document
Who Is Considered a Beneficial Owner?
A beneficial owner is any individual who:
- Exerts substantial control over the company, or
- Owns or controls at least 25% of the company’s ownership interests.
Understanding who qualifies as a beneficial owner within your organization is critical to ensure accurate reporting.
In your company was formed after January 1, 2024, one extra step is required: information about the company applicant (individuals responsible for filing the formation documents).
When Is the BOIR Due?
Deadlines for filing depend on when your company was created:
- Before January 1, 2024: File by January 1, 2025.
- On or after January 1, 2024: File within 90 days of creation or registration.
- After January 1, 2025: File within 30 days of creation or registration.
Additionally, updates must be filed within 30 days of any changes to reported information.
How Mila Realty Can Help
Ask Mila Realty to help. Our legal department and CPAs are here to assist you in navigating the nuances of BOIR requirements, ensuring your compliance while we are focusing on managing your rental properties.
We found this resource very useful. Stay informed and stay compliant.
Happy Property Management!
