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


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How to file a BOI Report in Massachusetts: 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 Massachusetts, 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.

Massachusetts, also known as The Bay State, has a population of 7,174,604. 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 Massachusetts

What is Beneficial Ownership in Massachusetts?

Beneficial ownership in Massachusetts 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 Massachusetts, 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 Massachusetts 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 Massachusetts.

BOI Reporting Companies (Entities) in Massachusetts

Not every company, located in Massachusetts, 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 Massachusetts that do not have BOI reporting requirements such as;

corporate-act
  • Sole proprietorships or any business structure that does not require registration under Massachusetts 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 Massachusetts?

In Massachusetts, 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 Massachusetts has to fill up the form and submit it within the given time. Here are the steps to file the BOIR in Massachusetts

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Online BOI Report Filing in Massachusetts

  • Step 1: For online filing, reporting companies in Massachusetts 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 Massachusetts

  • 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 Massachusetts and the rest of the United States. All the LLCs in Massachusetts, Corporations, and other types of businesses registered under Massachusetts Secretary of State will have to file the report within the given time.

  • Entities in Massachusetts incorporated or registered before January 1, 2024, will have to file their BOI report before January 1, 2025.
  • Entities in Massachusetts 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 Massachusetts SOS or similar authority.
  • Entities in Massachusetts 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 Massachusetts 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 Massachusetts is $500 a day for the company
  • The Criminal Penalty for not filing the BOI Report in Massachusetts is $10,000
  • Continuing violating rules and non-compliance in Massachusetts 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 Massachusetts.

BOI Reporting Required Information in Massachusetts

The Beneficiary Ownership Information consists of some confidential information about the LLC owners in Massachusetts. 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 Massachusetts 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 Massachusetts 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 Massachusetts

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 Massachusetts 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 Massachusetts or forming a corporation in Massachusetts 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 Massachusetts.

State Specific Data: Massachusetts

Capital and Incorporation

  • The capital of Massachusetts is Boston.
  • The population of Massachusetts: 7,174,604
  • The Annual GDP of Massachusetts: 693,131
  • Incorporation in Massachusetts can be done through various methods including online and offline. For more details, visit Massachusetts Secretary of State.
  • Incorporation Method in Massachusetts (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 Massachusetts (Offline): Send the form by mail or drop it off in person to William Francis Galvin, Secretary of the Commonwealth, One Ashburton Place, Room 1717, Boston, MA 02108.

Filing Fees

  • LLC Initial Filing Fee: $500
  • LLC Amendment Fees: $100
  • Annual Fee: $500
  • DBA Filing Fee: $65 Filing fee and $35 Additional fee if a non-Massachusetts resident
  • Incorporation Fee: $275 for filing online, in-person, or by mail
  • Registered Agent Change Fee: $25
  • Corporate Amendment Fee: $100

Important Offices

  • State Tax Office: Massachusetts Department of Revenue
  • State Insurance Office: Massachusetts Division of Insurance
  • Secretary of State Address: William Francis Galvin, Secretary of the Commonwealth, One Ashburton Place, Room 1717, Boston, MA 02108
  • 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: two methods, by mail and in person.
  • Filing Fee for DBA: $65 Filing fee and $35 Additional fee if a non-Massachusetts resident
  • Online Filing for DBA: There is no online filing available
  • Offline Filing for DBA: For filing offline, you must send the downloaded PDF form or drop it off in person at the City Clerk’s Office, 1 City Hall Square, Room 601, Boston, MA 02201

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

FAQs

How do I file a BOI report in Massachusetts?
To file a BOI report in Massachusetts, you can do so online through the state’s website.
What is a BOI report in Massachusetts?
A BOI report in Massachusetts stands for “Businesses Owned and/or Operated by Individuals,” which is a requirement for certain businesses within the state.
Are all businesses required to file a BOI report in Massachusetts?
Not all businesses are required to file a BOI report in Massachusetts. Only those businesses that meet the specific criteria set out by the state.
What information do I need to provide when filing a BOI report in Massachusetts?
When filing a BOI report in Massachusetts, you will need to provide information about the business owners, including their names, addresses, and ownership percentages.
Is there a deadline for filing a BOI report in Massachusetts?
Yes, there is a deadline for filing a BOI report in Massachusetts, which is typically within a certain number of days after the business’s formation or registration.
Can I file a BOI report in Massachusetts on behalf of someone else?
Yes, you may file a BOI report in Massachusetts on behalf of another individual, such as a business owner or an attorney representing the business.
What happens if I don’t file a BOI report in Massachusetts?
If you fail to file a BOI report in Massachusetts, you may face penalties, fines, or even the dissolution of your business.
Are there any fees associated with filing a BOI report in Massachusetts?
Yes, there may be fees associated with filing a BOI report in Massachusetts, so be sure to check the state’s website for the most current information.
Can I file a BOI report in Massachusetts by mail?
While filing a BOI report in Massachusetts online is preferred, you may be able to file by mail if necessary. Check with the state for details.
Do I need to file a new BOI report in Massachusetts every year?
No, you typically do not need to file a new BOI report in Massachusetts every year. However, you should update your report if there are any changes in ownership.
What documents do I need to submit along with a BOI report in Massachusetts?
Along with your BOI report in Massachusetts, you may be required to submit copies of legal documents like articles of organization or partnership agreements.
Can I file a BOI report in Massachusetts for a sole proprietorship?
Yes, you can file a BOI report in Massachusetts for a sole proprietorship, as long as it meets the eligibility requirements set by the state.
How long does it take to process a BOI report in Massachusetts?
The processing time for a BOI report in Massachusetts can vary, but it typically takes a few weeks for the state to review and approve your submission.
Is there a specific form I need to use when filing a BOI report in Massachusetts?
Yes, there is a specific form that you will need to use when filing a BOI report in Massachusetts. You can find this form on the state’s website.
Do out-of-state businesses need to file a BOI report in Massachusetts?
Yes, out-of-state businesses that operate in Massachusetts may be required to file a BOI report, depending on their ownership structure and other factors.
Can I file a BOI report in Massachusetts online if I am not a resident of the state?
Yes, you can file a BOI report in Massachusetts online even if you are not a resident of the state. Just make sure to follow the state’s guidelines.
What should I do if I encounter technical difficulties while filing a BOI report in Massachusetts online?
If you experience technical difficulties while filing a BOI report in Massachusetts online, you can contact the state’s customer service for assistance.
Can a professional accountant assist with filing a BOI report in Massachusetts?
Yes, a professional accountant or attorney can help you with filing a BOI report in Massachusetts, especially if you are unsure of the requirements or process.
Is there a helpline I can call for questions about filing a BOI report in Massachusetts?
Yes, there is a helpline available for questions about filing a BOI report in Massachusetts. Check the state’s website for contact information.
What kinds of businesses are exempt from filing a BOI report in Massachusetts?
Certain types of businesses, such as publicly traded companies or certain partnerships, may be exempt from filing a BOI report in Massachusetts.
Can I file a BOI report in Massachusetts for a nonprofit organization?
Yes, nonprofit organizations may still need to file a BOI report in Massachusetts if they meet the criteria set out by the state.
Can I file a BOI report in Massachusetts for a limited liability company (LLC)?
Yes, you can file a BOI report in Massachusetts for an LLC as long as it is required based on the ownership structure of the company.
What steps should I take if I need to amend a BOI report in Massachusetts?
If you need to amend a BOI report in Massachusetts, you can typically do so by submitting a revised report with the corrected information.
Are there any exemptions available for businesses filing a BOI report in Massachusetts?
While there may be exemptions available for certain businesses, it’s important to check with the state to determine if you qualify for any exemptions.
Can I file a BOI report in Massachusetts for a family-owned business?
Yes, you can file a BOI report in Massachusetts for a family-owned business, as long as you provide accurate information about the family members who own or operate the business.
Do I need to file a separate BOI report in Massachusetts for each of my business locations?
Yes, if you have multiple business locations in Massachusetts, you may need to file a separate BOI report for each location to ensure compliance with state regulations.
How can I check the status of my BOI report in Massachusetts?
You can typically check the status of your BOI report in Massachusetts online through the state’s website by entering your reference number or other identifying information.
Can I file a BOI report in Massachusetts on behalf of a deceased business owner?
If a business owner has passed away, you may need to provide additional documentation when filing a BOI report in Massachusetts, such as a death certificate or probate court documents.
Is there a grace period for filing a BOI report in Massachusetts after the deadline has passed?
While there may be some flexibility in certain circumstances, it’s best to file your BOI report in Massachusetts by the deadline to avoid any potential penalties or consequences.
Is filing a BOI report in Massachusetts mandatory?
Yes, filing a BOI report in Massachusetts is mandatory for certain types of businesses.
Can I file a BOI report in Massachusetts online?
Yes, you can file a BOI report in Massachusetts online through the Bureau of Investigation website.
How often do I need to file a BOI report in Massachusetts?
The frequency of filing a BOI report in Massachusetts depends on the type of business and its activities.
What happens if I fail to file a BOI report in Massachusetts?
Failure to file a BOI report in Massachusetts may result in penalties and fines.
Can I request an extension for filing a BOI report in Massachusetts?
Yes, you can request an extension for filing a BOI report in Massachusetts under certain circumstances.
How long does it take for a BOI report to be processed in Massachusetts?
The processing time for a BOI report in Massachusetts may vary depending on the volume of reports being filed.
Are there any incentives for filing a BOI report in Massachusetts?
There may be incentives for filing a BOI report in Massachusetts, such as tax deductions or credits.
Can I file a BOI report in Massachusetts if I am an out-of-state business?
Yes, out-of-state businesses can file a BOI report in Massachusetts if they conduct business in the state.
What should I do if I am unsure about how to file a BOI report in Massachusetts?
If you are unsure about how to file a BOI report in Massachusetts, you can contact the Bureau of Investigation for assistance.
Are there any training resources available for filing a BOI report in Massachusetts?
Yes, the Bureau of Investigation may offer training resources for individuals and businesses on how to file a BOI report in Massachusetts.
Can I amend a BOI report in Massachusetts after filing?
Yes, you can amend a BOI report in Massachusetts after filing if there are errors or changes to be made.
How can I learn more about the legal requirements for filing a BOI report in Massachusetts?
You can learn more about the legal requirements for filing a BOI report in Massachusetts by reviewing the state statutes and regulations.
What are the consequences of providing false information on a BOI report in Massachusetts?
Providing false information on a BOI report in Massachusetts may result in legal action and penalties.
Does Massachusetts require annual BOI reports from businesses?
Yes, Massachusetts may require annual BOI reports from businesses based on their activities and operations in the state.
Can I file a BOI report in Massachusetts if I am a sole proprietor?
Yes, a sole proprietor can file a BOI report in Massachusetts if they meet the reporting requirements.
Are non-profit organizations required to file BOI reports in Massachusetts?
Yes, non-profit organizations may be required to file BOI reports in Massachusetts if they engage in certain activities.
How far back do I need to report financial information in a BOI report in Massachusetts?
The timeframe for reporting financial information in a BOI report in Massachusetts may vary, but typically includes recent transactions.
Can I file a joint BOI report in Massachusetts for multiple businesses under the same ownership?
Yes, you can file a joint BOI report in Massachusetts for multiple businesses under the same ownership, but each entity must be listed separately.
What should I do if I am unable to file a BOI report in Massachusetts on time?
If you are unable to file a BOI report in Massachusetts on time, you should contact the Bureau of Investigation to determine next steps.
How does filing a BOI report in Massachusetts impact my taxes?
Filing a BOI report in Massachusetts may impact your taxes by providing information that is used in tax assessments and audits.
Can I receive assistance with filing a BOI report in Massachusetts from a professional accountant or attorney?
Yes, you can receive assistance with filing a BOI report in Massachusetts from a professional accountant or attorney who is familiar with state reporting requirements.
Are there any exemptions for certain types of businesses when filing a BOI report in Massachusetts?
Yes, there may be exemptions for certain types of businesses when filing a BOI report in Massachusetts, such as small businesses with minimal activity.
What steps should I take to ensure my BOI report in Massachusetts is accurate and complete?
To ensure your BOI report in Massachusetts is accurate and complete, you should review all information carefully before submitting and keep detailed records of transactions.
Can I file a BOI report in Massachusetts anonymously?
No, you cannot file a BOI report in Massachusetts anonymously; accurate and verifiable information is required for compliance purposes.

Also Read

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 Massachusetts, especially, small and medium businesses must file the Business Ownership Information Report to combat growing financial crimes. In Massachusetts, the companies must understand the obligations to comply with the rules.

In Massachusetts, 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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