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BOI Breakdown: What the New Reporting Rules Mean for Your Practice · The Millionaire Dentist™

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  Hello, everyone, welcome to The Millionaire Dentist podcast, brought to you by
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  four Quadness Advisory. On this podcast, we break down the world of dentistry,
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  finances and business practices to help you become the millionaire dentists you deserve to
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  be. Please be advised we do speak with an honest tongue and may not
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  be safe for work. Hello and welcome to another episode of The Millionaire Dentist.
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  My name is Jared Bridgeman. I'll be your host today. Casey is
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  out greeting fans and holding babies and all kinds of stuff, so instead I've
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  brought in the world famous Steve Levy pipes. Over the weekend we had our
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  holiday party here for the company, and at one point the karaoke machine came
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  out and Steve a couple of songs for Steve. What you sing? I
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  sang Let's Stay Together by Al Green and have yourself from Mary Little Christmas and
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  you killed it, Thank you, and just keep Mike's away because it's too
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  tempting. So I'm gonna go off. So that's right, that's right,
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  Steve. You wanted to come and talk today, specifically about BOI, which
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  is an acronym I've heard thrown around before, but I'm not super familiar with
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  what is BOI what does that those letters stand for? So they it stands
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  for Beneficial Ownership Information, okay, and so what does that mean? What
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  is that? Back in twenty twenty one, Congress passed what's called a Corporate
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  Transparency Act, and the law created a new beneficial Ownership information reporting requirement as
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  part of they say the US government's efforts to make it harder for like bad
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  actors to kind of hide or benefit from ill gotten gains. This is direct
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  from them through shell companies or other strange opaque ownership struck. Okay, And
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  would you say this game into effect? Was passed in twenty twenty one and
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  twenty twenty four is when it's come to effect really anyway, it really is.
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  It's not off the presses. So most companies will have to do this
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  report, this filing, and basically for those that typically have twenty five percent
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  or more of ownership of some entity, they're going to have to provide their
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  full legal name, data, birth, residential address, a number from their
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  passport or driver's license, and an actual copy of that passport or driver's license.
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  So this may not This doesn't pertain to like a minority owner who owns
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  like a percentage, right, if it's tiny, Yeah, it's not going
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  to be then so and so would that be considered the exceptions? Are there
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  any other exceptions to to who may rent the report with us? Yeah,
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  there are a few. There's like twenty three listings of exceptions. Some of
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  the main ones are those that make larger operating companies. So if they've reported
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  five million in grocery sipts on a prior your federal income tax returns, that's
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  one that they can get out of the filing. Maybe a large company lobby
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  or that was able to get that through. Tax Exempt entities are also those
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  that don't have to file and then so tax exemps. Would that be like
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  a non for profit profit? Yeah, that's another. And then another one
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  kind of to note is if you've got an LLC that you've created that really
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  hasn't done much at all, and lcs are roped into this as well as
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  really any kind of energies except for a soul prop If you've registered with the
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  Secretary of State for an enemy, then you're kind of on the hook unless
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  you have a super inactive energy that really hasn't done much at all. Okay.
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  So let's say somebody out there has a them or their wife, spouse,
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  whatever, may have a small side business as an LLC. Let's say
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  they do they sell I don't know, dolls clothing on Etsy. Yeah,
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  they're still on the hook for this, I absolutely are. Okay, even
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  if they made twelve bucks last year, really really minimal activity will require you
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  to file this. So okay, it's usually well, one thousand or less
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  is sort of the threshold. If you haven't done one thousand and a year,
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  then you don't have to file. But okay, thousands sort of the
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  threshold. Okay, okay. And so if I fall into this preview here,
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  if I have to report this in twenty twenty four, when does that
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  start? When do I need to report? Right? So, if you've
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  had an entity that existed prior to two thousand the end of twenty twenty three,
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  then you have to file this report by January first, two thousand and
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  twenty five. Oh okay, so we have a full full year. Yeah,
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  and they actually haven't gotten things together yet for how to file it.
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  The expectation is that Finsen, who's the financial crimes enforcement network, the ones
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  that will administer this. They're going to set up a website for people to
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  file there. Optimally, they'll also have softwares like what we use that will
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  allow to file on clients behalf as well. So they're still developing it.
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  But is this something that I, as a business owner I have to go
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  and find and do I mean or is this something I will receive something in
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  the mail about or you know, I wouldn't count on that, so we
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  need Yeah, some interneyes might not be on the radar for it's a subdivision
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  of the Department of Treasury, and so that's one entity that was in existence
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  prior to twenty twenty four. If you've created an entity in twenty twenty four,
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  you actually have ninety days from the time of creation to get the filing
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  in. Now, if you've created an entity in twenty twenty five, you
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  have thirty days. And then if you've had a change, like say a
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  sale, this is pretty permanent. This is yeah, yeah, it said
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  it was bipartisan support for it, and so it's probably going to be around
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  for a while. Let's say something has changed regarding the information since reporting,
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  how does that work out? Well, then you've got ninety days from the
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  time that change. Now it's either an ownership name change what right, like
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  an entity change and pretty much a change in what you reported previously, which
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  you don't have to report a whole lot. It's basically the entity and information
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  about the owner. Well, let's say you you sold thirty percent of your
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  company that has to be reported. Yeah, yeah, and then the new
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  person has to report on their side too, exactly. Yeah, ok so
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  there's changes and then the new owner reporting. So this would definitely be this
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  is filing based upon the actual owner itself and not so much the company.
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  Like again, because each person has twenty five or more ownership needs to have
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  this completed. That's right now, it's really going to be they can they
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  say they can go after either one. If there's a non compliance for this.
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  Oh boy, yeah, they don't mess around and fincent So let's just
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  say I don't want to do this. What if I'm I don't want to
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  report on this work? Uh so, what's the punishment? Okay, well
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  that there is a pretty stiff punishment for that. They've said that. Okay,
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  if you if you if it was more accidental as far as uh,
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  not doing it, then okay, you have ninety days to kind of correct
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  that mistake or omission, So no big deal. Now, if if they
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  find that you're willfully violating those reporting requirements, right, civil penalties of up
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  to five hundred dollars a day that the violation occurs, and you can also
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  be subject to criminal penalties of up to two years imprisonment and a fine of
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  up to ten thousands. So they're not messing around here at all. And
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  this is typical from this type of reporting. Right now, we have reportings
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  of foreign bank accounts that if people have ten thousand or more in foreign bank
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  accounts, it's also a similar filing, similar penalties, and it's kind of
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  under that same umbrella. But yeah, they don't mess around. They really
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  want this. It's hopefully they'll make it easy to file so that it's not
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  an education right And really they're actually putting up a bunch of frequently asked questions
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  really as late as last week because there's so many questions on this, so
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  you can go to the fins end website and look at those. They'll be
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  updated. Last update was December twelfth. As people are thinking about this and
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  they're going to continually update based on questions people have. So, in terms
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  of getting the most time available to work on this report, would you suggest,
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  if you're going to start in any entity, do it the next week
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  versus like the first week. Yeah, I would say, yeah, squeeze
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  it in. And and we've had questions, do you have to file by
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  the end of this year? No, don't worry about filing. But hey,
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  what I've seen questions where people have wanted to restructure things, like,
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  let's say they have an inactive entity. They're thinking about closing it so they
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  don't have to worry about that. Now, you know, there's different reasons
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  to do that, but this might be one. They're like, no,
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  I don't there's there's planning going on before the end of the year. Now
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  it's it's just a simple filing. It's not the typical practice owner. Yeah,
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  I one hundred percent, I'll file it a big deal. It just
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  kind of sits there until something major changes, right, right exactly. Yeah,
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  there hasn't been that's a good question on that, because there hasn't really
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  been anything as far as an annual filing. It's just sort of there.
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  They don't say like some other filings that it's an annual one. Now that
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  might change, but that's what it is right now. That information gets reported
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  to to the government. There who can access that information, that's a great
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  question. So it's not your neighbor or anyone that there's not a database of
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  this online. No, So what they say is that they allow federal,
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  state, and local governments as well as I guess certain they say certain foreign
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  officials who submit request through a US government agency to obtain this information for authorized
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  activities related to national security, intelligence, and law enforcement. So that's what
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  kind of drives that. They also say financial institutions will have access to that
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  in certain circumstances with the consent of the reporting company, because banks have to
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  it's another way to verify that, Okay, this person is who they say
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  they are, but that in that instance they have to get consent of the
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  reporting company for that. Stee, I wanted to thank you so much for
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  coming in today. If if, if you're not a client of ours,
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  it's probably best to if you haven't heard about this yet, to reach out
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  to your your c P. A. Yeah, absolutely, and and go
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  on www dot FinCEN dot gov forward slash b o I it's right there,
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  Okay, and then, of course, if you are a client of ours,
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  Steve, you're gonna be taking care of the stuff. Mark. That's
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  very sure. That's right, We're on it. That's right, Steve.
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  Thank you so much for coming in today. I wanted to wish everybody out
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  there happy holidays and happy New Year. We're gonna be taking a break after
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  this week since I will not be here. I'll be on vacation with my
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  kiddos. After that we'll be back and we'll be visiting some new areas and
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  spreading the good word. Will be in Book of Raton in January, and
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  then in February we will be in San Antonio. So thanks again, Steve.
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  All right, that's all the time we have today. Thank you to
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  our guests for their insight and for sharing some really great information, and thank
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  you to you the listener for tuning in. The Millionaire Dennis Podcast is brought
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  to you by four Quadrance Advisory to see if they might be a good fit
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  for you and your practice. Going over to four Quadrantsadvisory dot com and see
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  why year after year they retain over ninety five percent of their clients. Thank
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  you again for joining us, and we'll see you next time