How To Avoid A Fine If Your Duplex Is Owned By An LLC

If you own your Minneapolis duplex, triplex or fourplex in an LLC, there’s some paperwork you need to file.

That’s because on January 1, 2024, the Corporate Transparency Act (CTA) went into effect.  It was created to fight illicit activity like financing terrorism, tax fraud and money laundering by requiring an accounting of more ownership information about the names behind the companies.

Previously, business owners could file with the secretary of state where they lived and have a third party, such as an attorney, to be registered as the manager. This offeres owners of LLC’s a layer of anonymity. That’s a great thing to have – until someone uses it as a way to cover their tracks.

Businesses that meet certain criteria (like not being publicly traded) have to complete Beneficial Ownership Information (BOI) report with the U.S. Department of Treasury’s Financial Crimes Enforcement Network (FinCEN). The form requires more information identifying individuals associated with the company on the report than is typically associated with a state’s LLC or corporate filing.

For example, the form requires owners names, addresses, birthdays, driver’s license or passport numbers and the name of the place those documents were issued. Information about the company itself, such as its main business address, taxpayer identification number and state they’re registered in may also need to be provided.

The good news is this information will not be shared publicly. The bad is if you fail a company’s owners fail to file the form, it can be fined up to $10,00. Yes, even if it’s an S-corp.