Here, we discuss who is a company applicant for the purpose of filing a BOI report?

The Financial Crimes Enforcement Network (FinCEN) requires reporting companies to identify and report their company applicants when submitting a BOI report. 

Your company is only required to report its company applicants if it is created or registered on or after January 1, 2024.

If your company was created or registered before January 1, 2024, then it is not required to report company applicants on its BOI report.

A company applicant be one or two individuals:

1. The individual who directly files the document that creates OR first registers the entity in the US AND

2.  The individual who is primarily responsible for directing or controlling the filing of the formation document if more than one person is involved in the filing

In other words, reporting companies must identify the individual responsible for the company’s creation through the filing of formation documents, and the individual that directly submits the formation documents if a different person performs that function. Practically, there can be a maximum of 2 company applicants for any BOI reporting company.

A company applicant can be a person controlling the reporting company or employees of law firms, accounting firms and any other firms that offer business formation services and were contracted to form the reporting company. 

Company Applicants: Employees of Other Service Providers

In many cases, individuals meeting the definition of company applicants are employed by business formation companies, law firms or accounting firms. This is because many reporting companies use other service providers, such as online business formation companies or lawyers or accountants, to form their companies.

For example, you hire a law firm to create a reporting company. In this example, an attorney was primarily responsible for overseeing the preparation and filing of the formation documents, and a paralegal directly filed them with the state. This reporting company has two company applicants that need to be reported on the BOI report – the attorney and the paralegal. Any additional law firm employees who were indirectly involved in the company formation do not need to be reported.

Company Applicants: Owners and Other Individuals Associated with the Reporting Company

In other cases, individuals meeting the definition of company applicants are actually employees of a reporting company or persons who control a reporting company. This is the case when an individual associated with a reporting company creates it and files its formation documents without the assistance of a business formation service, law firm or similar service. Generally, such an individual is one of the founders.

For example, you prepare and self-file documents to create your own reporting company without the assistance of any company formation service provider. In this case, the reporting company has one company applicant to report on its BOI filing – you, the individual who is also reported as a beneficial owner.

In another example, you prepare formation documents for your own reporting company without the assistance of a business formation service, and a family member, agent, or other individual directly files the documents you prepared with the state. This reporting company has two company applicants—the individual who prepares the documents and the individual who directly files them.

State office employees and online formation services

State filing office employees who process formation documents in the ordinary course of their employment do not need to be reported.

Where business formation services provide software, online tools, or generally applicable written guidance, the employees of such services are not company applicants. However, employees of such services may be company applicants if they are personally involved in the filing of a document to form a particular company.

When Must a Company Report Its Company Applicants?

Suppose your company was created or registered before January 1, 2024. In that case, you do not need to report information about your company applicant in your initial BOI report or any subsequent BOI reports. 

Suppose your company was created or registered on or after January 1, 2024. In that case, you need to report your company applicant information on your initial BOI report, but you do not need to file updated BOI reports to update this information subsequently. See When Do I need to update a BOI report?.

If the company applicant information you provided is incorrect, then your company needs to file a corrected BOI report to correct the company applicant information. 

Failure to report company applicants

Willful failure to report company applicants may result in civil and criminal penalties. Companies should implement controls to ensure that they are in compliance with the reporting requirements.