With CTA becoming effective at the beginning of this year, companies have to report on their beneficial owners within 90 days of formation – or after any changes – or face substantial penalties. Determining if you need to comply with BOI reporting, and collecting the correct information for that reporting, can be a challenge. But WealthHub’s new Salesforce-based BOI Reporting module helps its clients fulfill the CTA mandates by using information already within WealthHub to help automate the tracking, information collection, and reporting processes.

On January 1, 2024, the federal Corporate Transparency Act (CTA) began requiring certain companies to file beneficial ownership information (BOI) reports. Family offices and trust companies were suddenly faced with the need to comply with CTA reporting requirements for hundreds, or even thousands, of entities for which they served as trustees or fiduciaries.

While many trusts are exempt from BOI reporting, they often have LLCs holding assets under them that are required to report.

Which entities must comply with BOI reporting?

Entities required to report are called reporting companies. Corporations, limited liability companies, and any other entities created by the filing of a document with a secretary of state or any similar office in the United States are reporting companies. If the entity was created by the filing of a document with a state, it will likely be a reporting company unless it falls into one of the 23 exempt categories, mostly related to larger size or already being under regulation. This includes banks, credit unions, brokers, investment companies, accounting firms, large operating companies, and more.

A statutory trust, business trust, or foundation is a reporting company only if it was created by filing a document with a secretary of state or similar office. State laws vary on whether certain trusts require filing a document with the secretary of state or similar office to be created or registered. If a trust is created in a U.S. jurisdiction that requires such a filing, then it is a reporting company unless an exemption applies.

What are the BOI reporting requirements?

If your trust or entity qualifies as a reporting company, and it was created or registered before January 1, 2024, you have until January 1, 2025 to report BOI. If you create a new entity in 2024, you must report BOI within 90 calendar days after receiving actual or public notice that the company’s creation or registration is effective, whichever is earlier. After 2024, you must file BOI within 30 calendar days after receiving actual or public notice that the entity’s creation or registration is effective.

It is important to note that any updates or corrections to beneficial ownership information must be submitted within 30 days. Changes that require reporting updates include a change of address of the reporting company or any beneficial owner (BOs), BOs being added or subtracted, and changes in ID documents for the BOs. However, beneficial ownership information reporting is not required annually. A report only needs to be submitted once unless you have changes or updates to make.

Information required for BOI reporting

All entities that must comply with BOI reporting must provide the following information for each individual who is a beneficial owner of the entity:

  1. The individual’s name
  2. The individual’s date of birth
  3. The individual’s residential address
  4. An identifying number from an acceptable identification document such as a passport or U.S. driver’s license, and the name of the issuing state or jurisdiction of identification document
  5. An image of the identification document used to obtain the identifying number in question four

If you serve as fiduciary for hundreds or thousands of entities and do not have this information already in hand, creating the BOI report could be a long and tedious project.

How Wealthhub helps ease the BOI reporting burden

WealthHub has developed a module that helps automate the onerous BOI reporting process. WealthHub’s BOI Reporting module can:

  • Help determine which existing entities are required to report or are exempt;
  • Identify the beneficial owners for reporting companies, whether by percent ownership or control position;
  • Automatically gather all the required information for the filing for the reporting company and the business owners and allow users to review and edit that information or add any missing information;
  • Format that information to match the FinCen reporting format for easy entry;
  • Provide reporting alerts by monitoring changes to addresses, ownership percentages, or ID documents that would require updates to the CTA filing for that entity; and
  • Soon, allow electronic filing of the BOI reports to FinCen

WealthHub’s BOI module is currently available to existing WealthHub subscribers.

If you need help assessing your BOI requirements and creating your BOI reports, contact WealthHub today. With its focus on UHNW fiduciaries, WealthHub combines state-of-the-art CRM with trust-specific business process management to deliver a unique platform for trust and family office administration.