How to File BOI Report in Maryland – Ultimate Guide (2024)


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How to file a BOI Report in Maryland: Since the Corporate Transparency Act, the Beneficial Ownership Information (BOI) principle has become an important aspect of the regulatory framework for Limited Liability Companies, Corporations, and all types of business structures. This act aims to increase transparency and fight against illegal financial activities by requiring businesses to disclose information about beneficial owners. In Maryland, companies must comply with these BOI reporting obligations, and this guide will give a comprehensive overview of the processes involved, entities affected, and compliance actions that must be put in place.

Maryland, also known as The Old Line State, has a population of 6,298,325. That makes the state small business friendly. According to the act, small and medium-sized businesses have to file BOI reports. In this article, LLCBuddy editors shared the latest update and mandate on filing BOI reports in Maryland

What is Beneficial Ownership in Maryland?

Beneficial ownership in Maryland entails individuals who own or control an entity ultimately even though legal ownership rests with some other person. These persons may have significant influence over it or hold substantial interest therein as owners. Identifying who qualifies as a beneficial owner is a critical first step in complying with BOI reporting requirements. To be a beneficial owner, one must meet at least one of the following:

  1. Has direct or indirect ownership of 25% or more of the entity’s equity interests
  2. Directly or indirectly exercises significant control over the entity

It should be noted that beneficial ownership can involve complicated ownership structures; therefore entities should conduct thorough assessments of their organizational structure and holdings.

Beneficial Ownership Information Reporting

The BOI (Beneficial Ownership Information) Report is a memo or document that every small and medium-sized business (exemption applicable) has to file with the Financial Crimes Enforcement Network (FinCEN). In Maryland, any LLC that is eligible to enlist under the reporting company must file the BOI Report within the given period.

It is not only mandatory for all businesses in Maryland but also can lead to heavy monetary penalties along with imprisonment. There are many reasons why the Corporate Transparency Act was started and BOI Report filing becomes mandatory for all businesses in Maryland.

BOI Reporting Companies (Entities) in Maryland

Not every company, located in Maryland, is required to file BOI reports with FinCEN. Only the eligible companies (Reporting Companies) are liable to file the BOI report. Following are the requirements for BOI reporting,

Entities Required to Report

There are certain entities that are considered “Reporting Companies” as per the Corporate Transparency Act and must report beneficial ownership information. Normally, these include:

Exempted Entities

However, it is important to note that there are certain entities in Maryland that do not have BOI reporting requirements such as;

corporate-act
  • Sole proprietorships or any business structure that does not require registration under Maryland SOS.
  • Large entities (more than 20 employees with $5M revenue)
  • Tax-exempt organizations
  • Inactive entities meeting specific criteria
  • Subsidiaries of exempt entities
  • Complex ownership that is not publicly known

For PLLCs, selected types of companies get to file BOI reports. Small PLLCs that do not meet the eligibility of reporting companies are exempted from filing BOIR. Besides, PLLCs that are already under stringent regulatory authority like the medical or law field, might get an exemption too.

List of Entities Exempted from BOI Reporting According to FinCEN

  • Securities reporting issuer
  • Governmental authority
  • Bank
  • Credit union
  • Depository institution holding company
  • Money services business
  • Broker or dealer in securities
  • Securities exchange or clearing agency
  • Other Exchange Act registered entity
  • Investment companies or investment advisers
  • Venture capital fund adviser
  • Insurance company
  • State-licensed insurance producer
  • Commodity Exchange Act registered entity
  • Accounting firm
  • Public utility
  • Financial market utility
  • Pooled investment vehicle
  • Tax-exempt entity
  • Entity assisting a tax-exempt entity
  • Large operating company
  • Subsidiary of certain exempt entities
  • Inactive entity

Entities should review their classification carefully in order to ascertain if they fall under the requirement for reporting or qualify for an exemption. It is recommended to consult an expert before you start filing your BOI Report. Also, not only the above-mentioned sectors but also the size and structure of the business matters when it comes to filing the report. Hence, it is important to consult an expert beforehand.

How to File a BOI Report in Maryland?

In Maryland, you can file your BOI report in two ways. The report can be filed online or offline. The process is pretty simple. There is an online and offline (PDF) form available. The reporting company in Maryland has to fill up the form and submit it within the given time. Here are the steps to file the BOIR in Maryland

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Online BOI Report Filing in Maryland

  • Step 1: For online filing, reporting companies in Maryland are required to visit the FinCEN BOIR e-filing page.
  • Step 2: The first page shows 4 options, Initial Report, Correct Prior Report, Update Prior Report, and Newly Exempt Entity.
  • Step 3: For the fresh filing, select Initial Report and click NEXT.
  • Step 4: On the next page, fill out the form for Reporting Company and ask for FinCEN ID.
  • Step 5: The ‘Company Applicant’ page comes up next. Add the details wherever is required.
  • Step 6: The next page shows the details of the Beneficial Owner(s). Also, mention if there is an exemption.
  • Step 7: Submit the online form after sharing your name and email on the final page.
BOI reporting e-filing

Offline BOI Report Filing in Maryland

  • Step 1: For offline filing, visit the FinCEN BOI Report filing page
  • Step 2: Download the PDF form from the ‘Prepare BOIR’ option
  • Step 3: The PDF form requires Adobe Reader 8 or higher, make sure you have this version installed on your device.
  • Step 4: Save the form on your device.
  • Step 5: Fill it up with the correct information. Make sure to select the ‘Initial Report’ if you’re filing it afresh. For correction or updating the previous form, select the other options.
  • Step 6: Once filled up, upload the form on the site by clicking on ‘Submit BOIR’.
  • Step 7: On the Submit page, you will have to provide your name and email. Click on the ‘upload document’ section to upload the PDF form and submit it.
BOI offline filing

Reporting Process and Timeline

BOI Reporting effectively becomes mandatory from January 1, 2024, in Maryland and the rest of the United States. All the LLCs in Maryland, Corporations, and other types of businesses registered under Maryland Secretary of State will have to file the report within the given time.

  • Entities in Maryland incorporated or registered before January 1, 2024, will have to file their BOI report before January 1, 2025.
  • Entities in Maryland incorporated or registered on or after January 1, 2024, will have to file their BOI report within 90 working days from the date of completion of company registration with Maryland SOS or similar authority.
  • Entities in Maryland incorporated or registered on or after January 1, 2025, will have to file their BOI report within 30 working days from the date of completion of company registration with Maryland SOS or similar authority.

Penalties for Non-Compliance with CTA (BOI Report Filing)

The authority decides to make it more difficult for the companies that fail to comply with the Corporate Transparency Act or BOI report filing. Following are the monetary and other penalties for non-compliance,

  • The Civil Penalty for missing the deadline in Maryland is $500 a day for the company
  • The Criminal Penalty for not filing the BOI Report in Maryland is $10,000
  • Continuing violating rules and non-compliance in Maryland can lead to 2 years imprisonment

The FinCEN makes sure that every reporting company must file the BOI report as soon as they meet the eligibility criteria. The penalty is heavy, especially for small businesses in Maryland.

BOI Reporting Required Information in Maryland

The Beneficiary Ownership Information consists of some confidential information about the LLC owners in Maryland. The compulsory information to be given in respect of each beneficial owner includes:

business requirement
  • Reporting Company legal name
  • Alternative or DBA Name (if any)
  • Tax Identification type
  • Country/Jurisdiction of Formation
  • Address (number, street, and apt. or suite no.)
  • Individual’s Full Legal Name
  • Date of birth
  • Current Address
  • Identifying document (Type, Number, Issuing Jurisdiction, Image)
  • Beneficial Owner Details (Legal Name, FinCEN ID, Address, DOB)

Entitles should confirm that the information given is correct and up-to-date as any inconsistencies or inaccuracies may attract penalties.

Ensuring their BOI reports are accurate and updated is a responsibility that these bodies have. Disputes or concealed information, therefore, need to be attended to quickly and openly as this is essential in compliance maintenance. Should organizations fail to do this, they may invite increased scrutiny with possible penalties imposed against them.

Privacy and Data Security

While the requirements for BOI reporting in Maryland aim at increasing transparency levels, there are practical challenges faced by entities regarding the identification and disclosure of beneficial ownership information. These may include:

  • Complexity in identifying beneficial ownership for entities with intricate ownership structures or multi-layered holding companies.
  • Difficulties in obtaining accurate and up-to-date information from beneficial owners, particularly where ownership interests are held indirectly or via intermediaries.
  • This places an additional burden on small businesses which will find it hard to deploy enough resources and personnel to deal with compliance matters.

Entities can overcome these hurdles through engagement of professionals’ advice; and having internal mechanisms that strengthen their capacity to communicate with their beneficiaries.

Regulatory and Legal Considerations

In addition to the issues above, entities in Maryland must also navigate numerous regulatory and legal considerations when reporting BOI. These include:

  • Balancing transparency with legitimate privacy concerns, especially for individuals who may be exposed to personal safety risks or other sensitive situations.
  • Addressing international implications and cross-border ownership structures since BOI reporting requirements can vary across jurisdictions.
  • Compliance with other relevant legislations such as anti-money laundering (AML) laws and know-your-customer (KYC) regulations is necessary as well.

What helps entities address these concerns is consulting the legal fraternity on changes occurring within the regulatory space.

Anticipated Changes and Updates

With time, FinCEN together with other relevant agencies will provide further guidance on complying with these reporting requirements as financial crime evolves. For instance, new changes could affect how they comply with these requirements. Additionally, in the future, there is a possibility of expanding or modifying the reporting requirements to deal with emerging issues or any possible loopholes.

Impact on Businesses and Financial Sector in Maryland

The introduction of BOI reporting requirements will have profound effects on both corporate entities and the financial sector as a whole. Likely consequences could include:

  • Increased administrative burdens and compliance costs for firms, especially at the early stages of implementation.
  • Enhanced due diligence procedures by financial institutions to verify the accuracy of BOI reports and identify potential red flags.
  • Business practices may change leading to ownership structures that are more flexible to fit into new transparency needs.
  • Entities that have complex ownership arrangements or those operating internationally may face some difficulties.

Nonetheless, in the long run, it can be expected that this law would go towards creating an environment where business is transparent and accountable thus enhancing trust and integrity within the financial system.

Significance of Reporting Beneficial Ownership Information

Reporting BOI is essential for several reasons. We have come up with three main reasons that CTA pointed out for having BOI reporting.

business
  • Preventing Illegal Activities: Identifying true owners helps to combat money laundering, terrorist financing, and other financial crimes in Maryland since bad actors cannot hide behind complex corporate structures.
  • Enhancing Transparency: It ensures corporate transparency and accountability so that entities cannot operate under cover but are required to reveal who their beneficial owner(s) are.
  • Facilitating Law Enforcement: Accurate data on BOI allows law enforcement authorities to investigate and prosecute fraudulent activities better thus protecting a fair business environment.

Starting an LLC in Maryland or forming a corporation in Maryland can be an eyewash of hiding other shady activities or illegal businesses. Companies often create shell companies to money launder. This reporting was started to prevent such activities in Maryland.

State Specific Data: Maryland

Capital and Incorporation

  • The capital of Maryland is Annapolis.
  • The population of Maryland: 6,298,325
  • The Annual GDP of Maryland: 474,424
  • Incorporation in Maryland can be done through various methods including online and offline. For more details, visit Maryland Secretary of State.
  • Incorporation Method in Maryland (Online): Get the online form from Secretary of State, fill it up, and submit. Don’t refresh the page during the process. It will erase everything.
  • Incorporation Method in Maryland (Offline): Send the form by mail to CoState Department of Assessments and Taxation, Charter Division 301 W. Preston Street; 8th Floor, Baltimore, MD 21201-2395

Filing Fees

  • LLC Initial Filing Fee: $100
  • LLC Amendment Fees: $100
  • Annual Fee: $300
  • DBA Filing Fee: $25 Filing Fee and $50 Expedited Fee
  • Incorporation Fee: $120 for filing in person and by mail
  • Registered Agent Change Fee: $25
  • Corporate Amendment Fee: $100

Important Offices

  • State Tax Office: Maryland Comptroller of Maryland
  • State Insurance Office: Maryland Insurance Administration
  • Secretary of State Address: CoState Department of Assessments and Taxation, Charter Division 301 W. Preston Street; 8th Floor, Baltimore, MD 21201-2395
  • Department of Treasury: Department of the Treasury Internal Revenue Service Center – Kansas City, MO 64999 Fax: 855-887-7734​

Key Contacts

  • Form 2335 Mailing Address: Department of the Treasury Internal Revenue Service Center – Kansas City, MO 64999 Fax: 855-887-7734​
  • Filing Method for DBA: three methods, online, by mail, and in person filing.
  • Filing Fee for DBA: $25 Filing Fee and $50 Expedited Fee
  • Online Filing for DBA: For online filing, check the Maryland Business Express Website. There, look for the “Fictitious Names” section. You will get the registration form.
  • Offline Filing for DBA: For filing offline, you must send the downloaded PDF form or drop it off in person at the Charter Division, Department of Assessments and Taxation, 301 W. Preston Street, Room 801, Baltimore, MD 21201

By staying compliant with the BOI reporting requirements and leveraging the resources available in Maryland, businesses can ensure they meet all regulatory obligations efficiently.

FAQs

How do I file a BOI report in Maryland?
To file a BOI report in Maryland, you can visit the Maryland Secretary of State’s website and follow the instructions provided.
Do I need to file a BOI report in Maryland if my business is inactive?
Yes, even if your business is inactive, you still need to file a BOI report in Maryland.
When is the deadline to file a BOI report in Maryland?
The deadline to file a BOI report in Maryland is generally every year by April 15th.
What information do I need to include in my BOI report in Maryland?
You will need to provide basic information about your business, such as its name, address, and status.
Can I file my BOI report online in Maryland?
Yes, in Maryland, you can file your BOI report online through the Maryland Secretary of State website.
What happens if I don’t file my BOI report in Maryland on time?
If you don’t file your BOI report in Maryland on time, there may be penalties or late fees imposed on your business.
Can I file my BOI report in person in Maryland?
Yes, you can file your BOI report in person at the Maryland Secretary of State office.
Is there a fee to file a BOI report in Maryland?
Yes, there is a fee to file a BOI report in Maryland, and the amount may vary depending on the type of business.
How can I check the status of my BOI report in Maryland?
You can check the status of your BOI report in Maryland online through the Maryland Secretary of State’s website.
Can I amend my BOI report in Maryland after filing it?
Yes, you can amend your BOI report in Maryland if there are any changes to your business information.
What kind of information do I need to include in my BOI report in Maryland?
In Maryland, you will need to include your business information, such as name, address, and contact information.
When is the deadline for filing a BOI report in Maryland?
The deadline for filing a BOI report in Maryland is usually April 15th of each year.
What happens if I miss the deadline for filing a BOI report in Maryland?
If you miss the deadline for filing a BOI report in Maryland, you may incur late fees or penalties.
Is there a fee for filing a BOI report in Maryland?
Yes, there is a fee for filing a BOI report in Maryland. The fee amount varies depending on the type of business.
Can I file my BOI report in Maryland online?
Yes, you can file your BOI report in Maryland online through the state’s official website.
How long does it usually take to process a BOI report in Maryland?
It typically takes several weeks to process a BOI report in Maryland, depending on the volume of reports received.
Can I request an extension for filing my BOI report in Maryland?
Yes, you can request an extension for filing your BOI report in Maryland, but you must do so before the original deadline.
What is the purpose of filing a BOI report in Maryland?
The purpose of filing a BOI report in Maryland is for the state to track and regulate businesses operating within its jurisdiction.
Are there any specific requirements for small businesses filing a BOI report in Maryland?
Small businesses in Maryland may have different reporting requirements than larger businesses. Consult the state’s regulations for more information.
Can I file a BOI report in Maryland if my business is located out of state?
Yes, if your business conducts business in Maryland, even if it is based out of state, you may need to file a BOI report in Maryland.
What should I do if I made an error on my BOI report in Maryland?
If you made an error on your BOI report in Maryland, you should contact the Maryland Department of Assessments and Taxation to make a correction.
Is there a help line I can call for assistance with filing my BOI report in Maryland?
Yes, there is a help line you can call for assistance with filing your BOI report in Maryland. Check the state’s website for contact information.
Can I file my BOI report in Maryland by mail?
Yes, you can file your BOI report in Maryland by mail. Be sure to mail it to the correct address provided by the state.
What are the consequences of not filing a BOI report in Maryland?
Failing to file a BOI report in Maryland can result in fines, penalties, or even the dissolution of your business.
Do I need to renew my BOI report in Maryland every year?
Yes, you typically need to renew your BOI report in Maryland every year to stay compliant with state regulations.
Can I file my BOI report in Maryland late?
You can file your BOI report in Maryland late, but you may face penalties or late fees for doing so.
Can I file a BOI report in Maryland if I recently started my business?
Yes, if you recently started your business in Maryland, you will still need to file a BOI report to comply with state regulations.
Are there any exemptions for filing a BOI report in Maryland?
Certain types of businesses may be exempt from filing a BOI report in Maryland. Check with the state’s regulations for more information.
How do I know if my business is required to file a BOI report in Maryland?
If your business conducts any operations in Maryland, you may be required to file a BOI report. Consult the state’s regulations for more information.
Can I amend my BOI report in Maryland after it has been filed?
Yes, you can typically amend your BOI report in Maryland after it has been filed. Contact the state’s department for instructions on how to do so.
Is there a specific form I need to use to file my BOI report in Maryland?
Yes, there is usually a specific form you need to use to file your BOI report in Maryland. You can find it on the state’s website.
If I have multiple businesses, do I need to file a separate BOI report for each one in Maryland?
Yes, if you have multiple businesses operating in Maryland, you will likely need to file a separate BOI report for each one.
Can I file my BOI report in Maryland without an accountant?
Yes, you can file your BOI report in Maryland without an accountant, but it is recommended to seek professional assistance for accuracy.
What documents do I need to attach to my BOI report in Maryland?
You may need to attach financial statements, organizational documents, or other relevant paperwork to your BOI report in Maryland. Check the state’s requirements for more information.
Can I file a BOI report in Maryland for a nonprofit organization?
Yes, nonprofit organizations operating in Maryland may still need to file a BOI report to stay compliant with state regulations.
Where can I get more information about filing a BOI report in Maryland?
For more information about filing a BOI report in Maryland, you can visit the Maryland Department of Assessments and Taxation website or contact their offices directly.

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In Conclusion

In the world of business, conducting illicit monetary transactions is not a new thing. To prevent that the Corporate Transparency Act came into the picture. Businesses in Maryland, especially, small and medium businesses must file the Business Ownership Information Report to combat growing financial crimes. In Maryland, the companies must understand the obligations to comply with the rules.

In Maryland, before you start filing the BOI Report, there are a few important points to note. Important points worth noting are:

  • Identifying beneficial owners from their control or ownership interests over the entity.
  • Reporting accurate information at all times including names, dates of birth, addresses, and identification details about beneficiaries.
  • Timely filing of the initial reports and updating the reports in case of changes.
  • When required, involve reputable third-party service providers to assist in the filing process.
  • Ensure compliance with relevant penalties for non –compliance.
  • Deal with practical challenges and legal issues related to BOI reporting.
  • Keep abreast of future developments and advice from relevant bodies.

Filing the BOI Report does not require complicated steps, however, it definitely requires an expert to proceed. We recommend TailorBrands, one of the best LLC formation services that not only offers free LLC formation but also offers BOI Reporting at a very reasonable cost.

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