Beneficial Ownership Information Reporting (BOIR)

SOURCE: https://fltms.famguardian.org/beneficial-ownership-information-reporting/

1. INTRODUCTION

1. Beneficial Ownership Interest Reporting (BOIR) is reporting about any of the entities doing business within the United States as mandated by 31 U.S.C. §5336.
2. Penalties for failure to report are severe and up to $500/day. Therefore understanding this subject accurately extremely important. See 31 U.S.C. §5336(h)(3)(A)(u).
3. To be REQUIRED to file BOI reports, you must be the following listed in 31 U.S.C. §5336(a)(11)(A), which is YOUR choice. Don’t VOLUNTEER!:
   31 U.S.C. §5336(a)(11)(A)
   
   (11) Reporting company. —The term “reporting company”—
   (A)means a corporation, limited liability company, or other similar entity that is—
   (i) created by the filing of a document with a secretary of state or a similar office under the law of a State or Indian Tribe; or
   (ii) formed under the law of a foreign country and registered to do business in the United States by the filing of a document with a secretary of state or a similar office under the laws of a State or Indian Tribe; and
4. Those expressly exempt from BOIR are itemized in 31 U.S.C. §5336(a)(11)(B). Exempt entities include:
   4.1. 26 U.S.C. §501(c) organizations. 31 U.S.C. §5336(a)(11)(B)(xix)(I)
   4.2. A political organization. 31 U.S.C. §5336(a)(11)(B)(xix)(II)
   4.3. A trust described in paragraph (1) or (2) of 26 U.S.C. §4947(a). 31 U.S.C. §5336(a)(11)(B)(xix)(III).
   4.4. Any corporation, limited liability company, or other similar entity of which the ownership interests are owned or controlled, directly or indirectly, by 1 or more entities described in clause (i), (ii), (iii), (iv), (v), (vii), (viii), (ix), (x), (xi), (xii), (xiii), (xiv), (xv), (xvi), (xvii) 1, or (xxi); 31 U.S.C. §5336(a)(11)(B)(xxi).
5. Definitions relating to BOI reporting are found in:
   5.1. 31 U.S.C. §5336(a).
   5.2. 31 C.F.R. §1010.100.
6. The default definition of “United States” is provided in 31 C.F.R. §1010.1000(hhh).
   31 CFR § 1010.100 – General definitions.
   
   (hhh) United States.
    The States of the United States, the District of Columbia, the Indian lands (as that term is defined in the Indian Gaming Regulatory Act), and the Territories and Insular Possessions of the United States.
7. The term “State” is defined in 31 U.S.C. §5336(a)(12) to include only the “States” listed in 4 U.S.C. §110(d). Nowhere is the term “State” defined to expressly include states of the Union. Therefore, they are purposefully excluded under the rules of statutory construction and interpretation.
8. The term “foreign person” is defined in 31 C.F.R. §1010.1000(a)(7) to be the same as that used in the Internal Revenue Code.
   31 CFR § 1010.100 – General definitions.
   (7)Foreign person.—
   The term “foreign person” means a person who is not a United States person, as defined in section 7701(a) of the Internal Revenue Code of 1986.

2. WHO HAS THE DUTY TO REPORT?

1. 26 U.S.C. §5336(a)(3) defines “beneficial owner”. It is not defined in 31 C.F.R. §1010.100.
2. 31 C.F.R. §1010.380 establishes who must report.
3. 31 C.F.R. §1010.100(t) establishes that the entities subject to reporting
4. 4 U.S.C. §110(d) is corporate/legal, not geographical.
5. 31 U.S.C. §5336(a)(12) State is corporate/legal and not geographical.
6. 31 C.F.R. §1010.100(hhh) “United States” is corporate/legal and not geographical
7. 31 C.F.R. §1010.100(o) “domestic means” within the corporation
8. 26 U.S.C. §5336(a)(11)(A) Reporting company is anyone who makes an election by virtue of a secretary of state election with a CORPORATE/POLITICAL state and not a foreign constitutional state
9. 26 U.S.C. §7701(a)(9) and (a)(10) are the geographical boundaries of the corporate/legal state because it is a geographical definition.
10. Those who elect “U.S. Person” status under 26 U.S.C. §7701(a)(30) are assimilated into the corporation/legal State and United States and become “domestic” because the office they occupy is domiciled in the corporate/legal “State” and “United States”.
11. A “U.S. person” is a resident agent of an office domiciled within the corporate/legal state regardless of their own personal domicile or residence. The entity they represent has a duty to report independent of their own individual duty.
12. Anyone who elects “U.S. person” status is surety for a DOMESTIC office and have a duty to report. Anyone who does not but elects a foreign status remains foreign and does not have a duty to report.
13. One can be “foreign” for the purposes of Title 26 while being “domestic” for the purposes of Title 31 BOI reporting if their entity made a 31 U.S.C. §5336(a)(11)(A) election with the secretary of state of a corporate/legal “State” to do business in the corporate/legal “United States”.
14. States mentioned in the U.S. Constitution have no constitutional or statutory authority to act as corporate/legal “States” under federal law because this would violate the separation of powers doctrine. However, like individuals, they can also make a “domestic” election in pursuit of federal privileges. But when they do, that election only changes their relation to the national government to corporate/legal. It does not change their status to corporate/legal in their interactions with others.
15. Thus, unless your business was registered with the Secretary of State of a territory or possession (called a “State” in 31 U.S.C. §5336(a)(11)), you would not be responsible for BOI Reporting. Such “States” are legislatively foreign with respect to the states mentioned in the Constitution. For proof, see:
    PROOF OF FACTS: “State” in 26 U.S.C. 7701(a)(10) and “States” in 26 U.S.C. 7701(a)(9) do NOT include Constitutional States, FTSIG
    https://ftsig.org/frivolous-subject-state-in-26-u-s-c-7701a10-includes-constitutional-states/

3. ADMINISTRATIVE REFERENCES

1. Fincen BOI
   https://www.fincen.gov/boi
2. FinCEN’s BOI Reporting Rule Fact Sheet
   https://www.fincen.gov/beneficial-ownership-information-reporting-rule-fact-sheet
3. FinCEN’s BOI FAQs:

   https://www.fincen.gov/boi-faqs

4. LEGAL REFERENCES

1. The Corporate Transparency Act text
   https://www.congress.gov/bill/116th-congress/house-bill/2513/text
2. The Final Rule in the Federal Register
   https://www.federalregister.gov/documents/2022/09/30/2022-21020/beneficial-ownership-information-reporting-requirements
3. 31 U.S.C. §5336: Beneficial Ownership Information Reporting Requirements
4. The Anti-Money Laundering Act of 2020
5. Nationall Defense Authorization Act of 2021, Division F
6. 81 F.R. 59498: Beneficial Ownership Reporting Requirements
7. 31 CFR Subpart C – Subpart C—Reports Required To Be Made