If you use an LLC to own a rental property or operate a business, you likely face the new filing requirement by the Department of the Treasury’s financial intelligence unit. Financial Crimes Enforcement Network (FinCEN). Businesses and Rentals existing on January 1, 2024, will trigger the FinCEN filing requirements.
The individuals who ultimately own or control the company are known as Beneficial Owners. A Beneficial Owner is everyone with 25% or more equity interest in the legal entity, whether directly or indirectly. The entity must have a minimum of one and a maximum of five beneficial owners.
Know that you have plenty of company: About 32 million existing businesses (and rental property owners) will be affected by this new filing requirement. Failure to file can result in big penalties and possible prison time along with civil penalties of up to $500 for each day that a violation continues, capped at $10,000.
Now more than ever, a tax professional can guide you through the requirements you need to avoid FinCEN and other penalties. Start here: we welcome you to take advantage of a free discovery session by visiting New Client Application or https://calendly.com/d/46r-49m-93k/10-minute-intro-call.