Changing a Previously Filed BOI Report

Reporting companies must file corrected and updated reports as needed

After a reporting company files its initial BOI report, it must file either an updated or corrected report if the initial report is no longer accurate.

Updated reports are required when there is a change to previously reported information about the reporting company or its beneficial owners. They are due within 30 calendar days after a change occurs. See 31 C.F.R. §1010.380(a)(2)(i).

Corrected reports are required when previously reported information was inaccurate when filed. They are due within 30 calendar days after the reporting company becomes aware or has reason to know of an inaccuracy. See 31 C.F.R. §1010.380(a)(3).

Change Process Step by Step

Completing an updated or corrected report is almost the same as filing the initial report. Go to the BOI Report E-file system and select “File BOIR”:

To use the web version, select “File Online BOIR” and click “Prepare & Submit BOIR”:

Next, select whether it is a corrected report (b) or an updated report (c):

If a reporting company becomes exempt from BOI reporting, it must file a report to tell FinCEN it is now exempt using the “newly exempt entity” (d) filing type.

When filing an updated or corrected BOI report, the reporting company completes the information as it would for an initial report. Please review the prior article on completing the initial report, which goes step-by-step through the process.

Is There a Penalty?

Under 31 U.S.C. §5336(h)(1)(B), it is unlawful for any person to willfully fail to report complete or updated beneficial ownership information. The penalty is $591 per day, up to a maximum of $10,000, and up to two years in prison.

The reporting company does not overtly disclose either the item that changed or the change or inaccuracy discovery date in the new filing. It also does not provide the original BOI report's BOIR ID or Submission Tracking ID.

The lack of the above information on an updated or corrected report indicates that FinCEN has no information with which to auto-assert penalties for failing to correct or update reports in a timely manner unless FinCEN overtly examines the issue.

This comports with the reality that there are only penalties for willful violations of the BOI reporting requirement; willfulness requires a higher standard of proof involving both the person's knowledge and intent. Internal Revenue Manual 4.26.16.5.5.1 (06-24-2021) discusses willfulness with respect to the willful FBAR penalty, which is also a Title 31 penalty. There are both non-willful and willful penalties with respect to the FBAR; the BOI reporting statute has no non-willful penalty provision.

In the preamble to the final beneficial ownership information reporting requirements regulations, FinCEN stated the following concerning penalties (emphasis added):

Any assessment as to whether false information was willfully filed would depend on all of the facts and circumstances surrounding the certification and reporting of the BOI, but as a general matter, FinCEN does not expect that an inadvertent mistake by a reporting company acting in good faith after diligent inquiry would constitute a willfully false or fraudulent violation.

A Long Way to Go

Fun fact: my reporting company’s original report was filed on January 1, 2024, and its BOIR ID was 50000000000055. The BOIR ID of the updated report that I filed on October 19, 2024, was 50000005601870. Assuming a sequential numbering system, it is likely that tens of millions of BOI reports still need to be filed by January 1, 2025.

Small businesses need all the help they can get to meet this new reporting requirement. Tax professionals, as the key advisors to many small businesses, have an essential role in assisting businesses in complying with the BOI requirements.

There are four paths to helping our small business taxpayers with BOI compliance, and every tax practice should select one of these four options:

1. Provide education about the requirement. This is the minimum tax professionals should do; education should start in January 2024 and continue during the one-year compliance period.

2. Provide education and track client self-compliance. For large tax practices, this could require tracking thousands of entities.

3. Outsource preparation to a third-party firm. Many service providers will assist with BOI compliance; tax professionals can establish a referral relationship with one or more firms.

4. Prepare the required forms. A tax professional must consider the legal, financial, and operational consequences before offering this service.

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