Operating a small business entails much more than you would think in today’s day and age. Not only do you have to perfect your product offering, but you have to master marketing, bookkeeping, taxes, and the ever-changing landscape of laws and regulatory requirements. The Austin Chamber of Commerce aims to keep our businesses informed about business law and regulatory requirements so businesses can stay ahead of the game.

In 2024, a new federal regulation added another mandatory reporting requirement for most small businesses in the country. The Corporate Transparency Act (CTA) aims to make business operations more transparent by requiring businesses to report the individuals who directly or indirectly own or control a company to the Financial Crimes Enforcement Network (FinCEN). Most small businesses in the country must also file a Beneficial Ownership Information Report (BOIR) to FinCEN. Combined, these regulations aim to help the agency close loopholes that have allowed individuals to use corporate entities for fraudulent purposes.

Failure to file a BOIR accurately and on time could result in criminal charges, up to two years in prison, fines up to $10,000, and daily civil penalties of $500. These consequences are serious and could severely impact businesses, especially the small and medium-sized ones that makeup the majority of all businesses in Texas and in the United States.

Sounds a little daunting, right? If you’re a small business owner who hasn’t filed yet, you’re not alone. Unfortunately, only about 5% of the 32 million small businesses across the country that need to file have done so. One significant reason for the low compliance rate is the general lack of awareness of the new regulations. However, not knowing about the law won’t protect you from penalties for not following it. It is vital that our business community closes this information gap.

If you own a business, we recommend filing your BOIR as soon as possible to stay compliant - and if you need help to navigate the process, seek out assistance from third-party experts to prevent incorrect filings. By relying on experts, like LegalZoom which has an office here in Austin and is a member of the Austin Chamber of Commerce, in the compliance space, small business owners will save money and, more importantly, valuable time. In fact, when LegalZoom surveyed small business owners on how they managed the filing process, they found that some people started the process with FinCEN but got stuck when not being able to answer very specific questions. They opted to get LegalZoom’s help simply so they could talk to someone live and have peace of mind.

Let’s work together and spread the word to ensure every business in Austin meets the new BOIR requirements. If you have any questions about BOIR or other regulatory requirements, feel free to use the Chamber as a resource.

You can find out more information about LegalZoom's services here.