FinCEN Beneficial Ownership Reporting

by Peter Rizzo

Life Settlements in a Retirement Account? Think Again.

There have been many discussions and meetings on the need for Check Book IRA LLCs to file a Beneficial ownership report with FinCEN. We are relying on attorneys and custodians and agree with the below. This also includes any LLCs owned by a Solo 401k

We are recommending that you File as required by 12/31/2024

An LLC owned by an IRA (Individual Retirement Account) may be subject to FinCEN’s beneficial ownership reporting requirements, which became effective with the Corporate Transparency Act (CTA) under the Anti-Money Laundering Act of 2020.

The key factor in determining whether the LLC needs to file a Beneficial Ownership Information (BOI) report with FinCEN is if the LLC qualifies as a “reporting company” under the Corporate Transparency Act. Reporting companies are generally required to disclose their beneficial owners, defined as individuals who:

  • Exercise substantial control over the entity, or
  • Own or control at least 25% of the entity’s ownership interests.

 Specific to an IRA-owned LLC:

  • If an LLC is owned by an IRA, the IRA itself is typically not considered a “beneficial owner” under FinCEN rules because the IRA is a tax-advantaged account rather than a person.
  • However, the beneficial owner of the LLC is generally the individual who controls the IRA, typically the IRA account holder (you, as the IRA owner, or someone who manages the account with authority).
  • If no other exemptions apply (such as being a regulated entity or falling under the “large operating company” exemption), the LLC will likely be required to file a BOI report, listing the individual IRA owner or another controlling individual.

Exemptions to the Reporting Requirement:

Some entities are exempt from reporting beneficial ownership under FinCEN rules, such as:

  • Entities already heavily regulated (e.g., banks, insurance companies)
  • Large operating companies with at least 20 employees and more than $5 million in revenue.

An IRA-owned LLC would not typically fall into these exemptions, meaning it will likely need to file a BOI report unless it qualifies for one of the specific exemptions.

In conclusion, an LLC owned by an IRA will generally be required to file a beneficial ownership report with FinCEN, with the individual controlling the IRA (typically the IRA account holder) being reported as the beneficial owner.

You can File on your own by going here.  They will ask you for pictures of your photo ID, etc., and have tutorials to help complete

We also have a filing Service that charges $75.00 and Files the forms and retains a copy as well as sending you the filing numbers. (We will also do this for any LLC).

Here is the link to engage us to file your Beneficial Ownership report with FinCEN.

There are alternatives now available and that is a trust owned by an IRA that is not required to report. please email IRAtrust@checkbookira.com

 

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    5 Comments

    1. Brian Roessler

      Does this filing requirement apply to Trust IRA’s?

      • Peter Rizzo

        No, this only applies to LLCs

        • Brian Roessler

          Thanks.

    2. G W Chase

      Well when this whole self directed 401K / LLC stuff was started , it was supposed to be easy. Each year it gets more complicated. This FinCEN amounts to treating you like a criminal.

      • Peter Rizzo

        Unfortunately, it has gotten more complicated, and it’s unfortunate for the people doing things correctly.