Understanding the Updates to Beneficial Ownership Information Requirements

If you are a business owner or have a trust agreement or other entity as part of your estate plan, you may be impacted by recent changes to Beneficial Ownership Information (BOI) requirements. These changes, introduced under the Corporate Transparency Act (CTA), are just one of many updates in recent years aimed at increasing transparency and preventing illegal activities like money laundering. While these new rules, which went into effect on January 1, 2024, have a noble purpose, they also create new compliance responsibilities for individuals managing businesses or entities within their estate plans. Understanding these requirements, as well as the changing landscape, is essential to protecting your financial future and avoiding penalties.

BOI rules require certain entities to disclose key information about their beneficial owners to the Financial Crimes Enforcement Network (FinCEN). A beneficial owner is defined as someone who owns at least 25% of the entity or exercises substantial control over it. Entities subject to these requirements must report details such as their legal name and address, as well as the full names, birth dates, residential addresses, and government-issued ID numbers of all beneficial owners. 

Many entities commonly used in estate planning, such as family businesses, trusts, or LLCs holding real estate or investments, fall under the scope of these new rules. Although larger corporations, certain nonprofits, and regulated entities are exempt, small and family-owned entities are generally required to comply. These changes can be particularly impactful for estate plans, as they introduce new obligations for trustees or individuals managing entities, raise privacy concerns for those who value confidentiality, and carry the risk of penalties for non-compliance.

If your estate plan includes entities subject to BOI requirements, taking action is critical. Start by reviewing your entities to determine whether they are impacted, then gather and verify ownership information, including government-issued IDs. Filing your BOI report before the deadline is essential to avoid penalties, and consulting with an estate planning attorney can help ensure your estate plan and entities comply with the new rules.

We know this article raises more questions than it answers. With so many regulatory changes in recent years, staying ahead can feel overwhelming. As experienced Florida estate planning attorneys, we are here to help you navigate these updates and protect the integrity of your estate plan. 

 

Elder and Estate Planning Attorneys, PA, is a law office small enough to provide personal service but large enough to provide service in Jupiter, as well as Palm Beach, Martin, St. Lucie, and Indian River Counties in Florida. Our law firm will guide you through legal challenges involving elder law, estate planning, trusts, veterans benefits, real estate, and more. We encourage you to contact us and schedule a meeting with our attorneys.