Corporate Ownership Reporting

In 2021, Congress passed the Corporate Transparency Act, which created a new beneficial
ownership information (BOI) reporting requirement as part of the U.S. government’s efforts to
make it harder for bad actors to hide or benefit from their ill-gotten gains through shell
companies or other opaque ownership structures. Under the law, beginning January 1, 2024,
certain types of corporations, limited liability companies, and other similar entities created in or
registered to do business in the United States (basically any company registered with a Secretary
of State’s office which does not meet one of 23 specific exemptions) must report information
about their BOI to the U.S. Department of the Treasury's Financial Crimes Enforcement Network
(FinCEN). BOI includes listing the persons who ultimately own or control the company, either
by exercising substantial control over, or owning or controlling at least 25 percent of the
ownership interests of, a reporting company. Ownership is obviously easy to figure out, but
individuals may exercise “substantial control” in several different, including being a senior
officer (president, CEO, COO, CFO, general counsel, etc.), holding authority to appoint or
remove certain officers or a majority of directors, being an important decision-maker (including
decisions regarding business, finances, or structure of the company), or any other form of
substantial control.

This filing must be completed through FinCEN in compliance with their rules and guidelines.
The reporting Timelines are:

1. If your company was created prior to January 1, 2024, you will have until January 1, 2025, to
report the BOI.

2. If your company is created in 2024, you must report the BOI within ninety (90) calendar days
after receiving actual or public notice that your company's creation is effective.

If you have not already filed your company’s BOI with FinCEN, or if you are unsure whether
your company is required to file or who needs to be named, and need help doing so, the attorneys
at Hagwood & Tipton, P.C. are happy to assist you with this process. Contact Philip Chapman at
(601) 608-3117 or via email at pchapman@hatlawfirm.com for any questions you may have.