UPDATE: On March 21, 2025, the Financial Crimes Enforcement Network (FinCEN) issued an interim final rule exempting U.S.-based companies and individuals from the Corporate Transparency Act’s Beneficial Ownership Information (BOI) reporting requirements. This means that most FCA members are no longer required to file BOI reports at this time. While the interim rule provides clarity for now, FinCEN is expected to open a public comment period and issue a final rule later in 2025, which could bring additional changes. FCA will continue to monitor developments and notify members of any updates.
Who Is Currently Required to Report
Foreign entities, including Canadian companies, that are registered to do business in the United States are still considered “reporting companies” under the Corporate Transparency Act and may have reporting obligations. However, under the March 21, 2025 interim final rule, these foreign reporting companies are exempt from reporting any beneficial owners who are U.S. persons. This means a Canadian company registered to operate in the U.S. would need to report information about its Canadian owners but would not be required to report U.S.-based beneficial owners.
About the Corporate Transparency Act
In 2021, Congress passed the bipartisan “Corporate Transparency Act,” (CTA) which introduces new reporting requirements for businesses, including corporations and LLCs. Despite significant industry pushback requesting a delay in its implementation, the CTA went into effect on Jan. 1, 2024. One of the CTA’s new requirements is reporting beneficial ownership information to the Financial Crimes Enforcement Network (FinCEN). The new requirement is part of a federal effort to enhance transparency and combat illicit activities such as money laundering.
Who Needs to Report
Foreign entities, including Canadian companies, that are registered to do business in the United States are still considered “reporting companies” under the Corporate Transparency Act and may have reporting obligations. However, under the March 21, 2025 interim final rule, these foreign reporting companies are exempt from reporting any beneficial owners who are U.S. persons. This means a Canadian company registered to operate in the U.S. would need to report information about its Canadian owners but would not be required to report U.S.-based beneficial owners.
Corporations, LLCs and any other entities created by the filing of a document with a secretary of state (or any similar office) in the United States, unless they qualify for an exemption, are required to submit a report. The Beneficial Owner Information (BOI) Report provides detailed information to FinCEN.
The Beneficial Owner Information (BOI) Report provides details about the individuals who have significant control or ownership in your company.
Exempt Companies
The March 2025 interim final rule exempts U.S.-based companies entirely from reporting. But foreign reporting companies (like a Canadian company registered in the U.S.) are still subject to BOI reporting, unless they qualify for one of the original exemptions listed in the rule.
There are no exemptions specific to the construction industry, however, “larger operating companies” qualify for an exemption. An entity is considered a “large operating company” if:
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It employs more than 20 full-time employees in the U.S.;
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It has an operating presence at a physical office within the United States; and
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It has filed a federal income tax or information return in the United States for the previous year demonstrating more than $5 million in gross receipts.
What Defines a “Beneficial Owner?”
A “beneficial owner” is defined under the rule as an individual who owns 25% or more of the company or has substantial control over its operations. Types of “substantial control” that would apply to this rule include:
- Decision-Making Power: the ability to make significant decisions about the company’s operations, finances or other key aspects without needing approval from others. (This could include decisions on major contracts, policies or strategic direction.)
- Management Role: holding a senior management position (such as CEO, CFO or other executive roles) where the individual has significant authority over company activities.
- Board Influence – the ability to influence or determine the outcome of decisions made by the board of directors, even if the individual is not a formal member of the board.
- Other Forms of Control – any other arrangements or relationships that give an individual significant influence over the company, even if they do not have a formal title or ownership stake.
What Needs to be Reported
- Legal name and address of your company.
- Names, addresses and identification details of beneficial owners.
- For companies formed after the CTA’s enactment (1/1/24), information about the individuals who filed the company’s formation documents.
When It Needs to be Reported
The timelines below apply only to foreign reporting companies, as U.S.-based companies are currently exempt from BOI reporting under the March 2025 interim final rule.
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Foreign entities registered to do business in the U.S. before March 26, 2025 must file their BOI reports by April 25, 2025 (30 calendar days from the rule’s publication date).
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Foreign entities registered on or after March 26, 2025 must file within 30 calendar days of receiving notice that their registration is effective.
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Once a report is filed, any changes to the reported information must be submitted within 30 calendar days of the change.
How to File Your Company’s BOI Report
Nonexempt companies must file their BOI report on FinCEN’s BOI online portal. Click here to access the filing form.
Penalties for Noncompliance
Per the CTA, a person who willfully violates the BOI reporting requirements may be subject to civil penalties of up to $500 for each day that the violation continues. That person may also be subject to criminal penalties of up to two years imprisonment and a fine of up to $10,000.
Both individuals and corporate entities may also be liable for willfully failing to report complete or updated BOI information. In such circumstances, individuals can be held liable if they either cause the failure or are a senior officer of the company at the time of the failure.
Questions Regarding BOI Reporting
FCA Legal Counsel is available to answer questions you may have regarding your company’s BOI reporting requirements. Click here to be put in contact with the counsel.