Decoding Kentucky's BOI Filings: What You Need to Know

Decoding Kentucky's BOI Filings: What You Need to Know
by Tiffany Shumake, Business Coach

Managing a business in the state of Kentucky comes with various responsibilities and legal obligations. In today’s dynamic business environment, it is critical to stay informed about the latest requirements, and one key aspect to focus on is compliance with the recently implemented Beneficial Ownership Information (BOI) filing regulations, mandated by the Corporate Transparency Act. These regulations, effective beginning January 1, 2024, carry significant implications for businesses throughout the state.

Understanding Beneficial Ownership Information (BOI) is a critical aspect of modern financial and legal practices, especially in the context of international business and anti-money laundering efforts. BOI refers to the identification of the actual individuals who own, control, or significantly influence a legal entity, such as a corporation, partnership, or other legal structure. This concept is important for uncovering the actual individuals behind the ownership structure who may not be immediately apparent through legal documentation alone.

Who Needs to File:

In the state of Kentucky, the requirements for filing Beneficial Ownership Information (BOI) align with federal guidelines. The specific entities that need to file BOI in Kentucky typically include:

1.      Corporations: Corporations registered or operating in Kentucky may have to provide information about their beneficial owners. This includes those who own a significant percentage of the corporation’s shares or have significant control over corporate decisions.

2.      Limited Liability Companies (LLCs): Like corporations, LLCs in Kentucky must identify and disclose any members or managers who exercise significant control or own substantial interest in the company.

3.      Partnerships and Other Legal Entities: This encompasses general partnerships, limited partnerships, and other forms of business entities that may have a more complex ownership structure.

Penalties for Non-Compliance

Business entities that are formed after January 1, 2024, will have 90 days to report their initial BOI. Business entities already in existence will have until January 1, 2025, to comply with the new requirement. Failure to comply with BOI reporting requirements may result in criminal prosecution and substantial monetary fines, which vary based on the non-compliance severity. Operational limitations may also occur, affecting business activities and capabilities. Additionally, non-compliance can result in reputational damage, loss of trust amongst stakeholders, and increased regulatory scrutiny with more frequent audits. In severe cases, it could even lead to revocation of business licenses or certifications.

Where to File:

FinCEN has developed an E-Filing System on its website, the link is found here.

Each beneficial owner of the business will have to provide:
·      Legal Name
·      Birthdate
·      Address
·      An identifying number from a driver’s license, state ID, or passport, and an image of the document that the number is from.

You will need the following information on behalf of your business:

·     Full legal name or DBA name it conducts business under
·     Address
·     Taxpayer Identification Number
·     Jurisdiction of Formation

Navigating these newly implemented regulations may seem like a challenge, but seeking advice is highly recommended. Remember compliance is not a one-time task, it is an ongoing commitment to the integrity of your business. If you find yourself struggling with the process, schedule an appointment.

If you would like to schedule a one-on-one meeting with business coach Tiffany Shumake book an appointment: https://calendly.com/tiffanyshumake