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What is a HOA BOI Report?

Homeowners associations should understand the requirements of the HOA BOI report. Under the Corporate Transparency Act, certain companies must file a report with FinCEN that includes specific information.

What is a HOA BOI Report?

A HOA BOI report is a Beneficial Ownership Information report comprising information regarding the entity, its beneficial owners, and its company applicants. It is a requirement under the Corporate Transparency Act, enacted in 2021, which seeks to promote accountability and transparency among reporting companies.

It aims to protect national security and fight illicit activities such as money laundering and tax fraud. The Financial Crimes Enforcement Network is responsible for enforcing the law.

Who is Required to File a BOI Report?

Reporting companies must file a BOI report with FinCEN. There are two types of reporting companies: domestic and foreign.

  • Domestic. This refers to corporations, limited liability companies (LLCs), or any entity created by filing a document with a Secretary of State or similar office under state laws or Indian tribe laws in the United States.
  • Foreign. This refers to corporations, limited liability companies (LLCs), or any entity created under a foreign country’s law registered to conduct business in any state or tribal jurisdiction by filing a document with a Secretary of State or similar office.

According to FinCEN, 23 types of entities do not have to file a BOI report. These are:

  • 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 company or investment adviser
  • 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

Is an HOA a Reporting Company Under the CTA?

As per the definition of a reporting company under the CTA, homeowners associations are considered reporting companies if they were created or registered by filing a document with a Secretary of State or similar office in the United States.

Is Beneficial Ownership Required for Associations?

An HOA classified as a reporting company must file a Beneficial Ownership Information report with FinCEN.

Is My HOA Exempt from CTA?

Generally, an HOA created or registered by filing a document with a Secretary of State or similar office is a reporting company and, therefore, must file a BOI report. An exception to the HOA BOI filing requirement would be if the HOA is a section 501(c)(4) organization under the IRS. In that case, an HOA may not need to file a BOI report as it is a tax-exempt entity.

When is the Deadline for the HOA BOI Report?

If an HOA was created or registered before January 1, 2024, it must file its initial BOI report by January 1, 2025.

If an HOA was created or registered after January 1, 2024, but before January 1, 2025, it must file its initial BOI report within 90 calendar days of receiving actual or public notice of the HOA’s creation or registration.

Finally, if an HOA was created or registered after January 1, 2025, it must file its initial BOI report within 30 calendar days of receiving actual or public notice of the HOA’s creation or registration.

What Should an HOA BOI Report Include?

There are three key components of a BOI report: information about the HOA, information about its beneficial owners, and information about its company applicants.

An HOA that qualifies as a reporting company must file the following information about itself:

  • Legal name;
  • Any trade names, “doing business as” (d/b/a), or “trading as” (t/a) names;
  • The current street address of its principal place of business if that address is in the United States;
  • Jurisdiction of formation or registration; and
  • Taxpayer Identification Number (TIN).

The HOA must also identify whether it is filing an initial BOI report or a correction or update of a report it filed previously. An HOA must file an updated report within 30 days of any changes to the association or its beneficial owners.

An HOA that qualifies as a reporting company must file the following information for each beneficial owner:

  • The individual’s name;
  • Date of birth;
  • Residential address; and
  • An identifying number from an acceptable identification document such as a passport or U.S. driver’s license, and the name of the issuing state or jurisdiction of the identification document.

The reporting HOA must also submit and file a photo of the identification document used to obtain the identifying number.

An HOA that qualifies as a reporting company must file the following information for each company applicant:

  • The individual’s name;
  • Date of birth;
  • Address; and
  • An identifying number from an acceptable identification document such as a passport or U.S. driver’s license, and the name of the issuing state or jurisdiction of the identification document.

The reporting HOA must also submit and file a photo of the identification document used to obtain the identifying number.

Does an HOA Need to File BOI Report Changes?

If any changes are made to the HOA’s information or its beneficial owners, the HOA must file an updated report within 30 days following the date of the change. However, an HOA is not required to file an updated report for changes to a company applicant’s previously reported information.

What Happens if an HOA Doesn’t Comply with the CTA?

Willful violation of the HOA BOI report requirements can carry penalties of up to $500 per day. This amount adjusts every year with inflation. As of writing, the adjusted penalty amount is $591.

In addition, willfully violating the BOI reporting requirements can result in a fine of up to $10,000 and up to two years in prison.

Can an HOA Use a Third Party to File a BOI Report?

Homeowners associations need not file the BOI report themselves. The requirements and filing process can be troublesome and confusing after all. As such, FinCEN permits HOAs to authorize a third-party service provider to file the HOA BOI report on its behalf.

Compliance is a Must

The HOA BOI report plays an important role in preserving national security and promoting transparency. It is a requirement under FinCEN’s Corporate Transparency Act. However, navigating the ins and outs of BOI filing requirements is challenging. HOAfiling.com’s online platform allows HOAs to file and continuously update their BOI reports with just a few clicks. Start your HOA’s BOI filing with us!

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