Important Update: At roughly 6:30 pm EST on December 3rd, 2024 a ruling out of the U.S. District Court for the Eastern District of Texas has blocked the Corporate Transparency Act (CTA) nationwide.

We recommend businesses proceed with caution and speak with their attorneys. The current ruling means that businesses are not obligated to comply with reporting requirements at this time, but it is not a final decision. It will go through the 5th circuit court next and then to the Supreme Court. 

https://news.bloombergtax.com/daily-tax-report/corporate-transparency-act-blocked-nationwide-by-texas-court

“The Court’s order is not a final decision, so businesses should remain cautious and be prepared to comply with the CTA reporting requirements if they are revived as the case proceeds, or if the injunction is lifted.”

https://natlawreview.com/article/nationwide-injunction-blocks-enforcement-corporate-transparency-act

Written by Kevin J. Bray, Partner @ the Dental Accounting Group

As a dental practice owner, staying compliant with the ever-evolving regulations is essential to maintaining your business’s integrity and avoiding unnecessary penalties. A critical new requirement for businesses, including dental practices, is the Beneficial Ownership Information (BOI) filing mandate. This regulation is aimed at enhancing transparency in business operations and ensuring compliance with legal standards. In theory the new law has good intentions, but in practice it’s creating confusion and another layer of compliance headache for small business owners. Here’s everything you need to know about BOI filings and how to stay ahead of the curve.

What Is BOI Reporting?

The BOI filing requirement mandates businesses to disclose information about individuals who own or control a significant portion of the company. This initiative is part of broader efforts to prevent financial crimes such as fraud and money laundering by ensuring that ownership structures are transparent. Business Ownership Information (BOI) reports with the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN). This new filing is a result of The Corporate Transparency Act (CTA) that went into effect on January 1, 2024, requiring businesses to now file ownership information with FinCEN to help identify criminal activity.

Key Facts You Should Know

Here are the main highlights of the BOI filing requirements:

• Who Needs to File: If you registered your business with the Secretary of State in your state, you are required to file. All limited liability companies (LLCs) and corporations must file. Disregarded entities, for U.S. tax purposes, must also file. For example, if you own multiple LLCs, each requires a separate BOI report. This includes all dental practices and other businesses as well as Single Member LLCs holding real estate.
• How to File: You will need to file directly with FinCEN on their website https://boiefiling.fincen.gov/or engage legal counsel to file on your behalf.
• Filing Deadline: If your business existed as of January 1, 2024, you must file your BOI report by January 1, 2025.
• Penalties for Non-Compliance: Failure to file on time can result in significant penalties, including fines of $591 per day, a potential $10,000 criminal penalty, and up to two years in prison.

Next Steps for Dental Practice Owners

If you haven’t yet filed your BOI report, now is the time to act. Here’s what you should do:

• Contact Your Attorney: Reach out to your attorney to understand the specific filing requirements for your practice. They can guide you through the process and ensure compliance.
• Gather Required Documentation: Collect all necessary details about the beneficial owners of your business. This includes full names, ownership percentages, and any supporting documents.

1. 1. Company legal name and current address
   2. Any assumed business name (DBA) used by the company
   3. EIN of the entity (Federal tax ID)
   4. Ownership information – Each owner’s name, birthdate, residential street address, and social security number
   5. A high-resolution PDF copy of your driver’s license or passport

• Submit Your Filing: Work with your attorney to file the report accurately and on time. There are multiple providers in the space offering to assist with this, but we recommend proceeding with caution due to the sensitive nature of the information. DO NOT SHARE YOUR SENSITIVE PERSONAL & FINANCIAL INFORMATION WITH UNKNOWN SERVICE PROVIDERS. 

Key Deadlines: 

• Existing businesses formed before January 1, 2024 – file by January 1, 2025
• New businesses formed on or after January 1, 2024 – file within 90 days of business formation
• New businesses formed on or after January 1, 2025 – file within 30 days of formation

The Bottom Line

Compliance with the BOI filing is a small task, but has huge penalties. We recommend all business owners (and real estate LLC’s) take prompt action. Don’t hesitate to contact your attorney to ensure your BOI filings are handled correctly and to avoid any penalties.

Stay informed, stay compliant, and focus on what you do best—caring for your patients!

Disclaimer: DG Accounting Professionals LLC dba Dental Accounting Group is not filing BOI for clients. This is a legal matter and we are not licensed to practice law. Work with your attorney to file the report accurately and on time.