The rule—the Beneficial Ownership Reporting Rule—requires small businesses to report their beneficial ownership information to the federal government.

Failure to submit the required information could result in civil fines of up to $10,000 and criminal penalties of up to two years in prison.

The rule applies to small businesses with $5 million or less in gross receipts and 20 or fewer employees.

Companies existing prior to January 1, 2024, will have until January 1, 2025, to submit their beneficial ownership information. New companies must report it within 90 days of their creation. If their beneficial ownership information changes, companies will have 30 days to update it with the federal government.

NFIB has prepared a fact sheet on the new reporting requirements. It can be found here. Answers to frequently asked questions can be found here.

NFIB opposed these new regulations. In July, NFIB’s Vice President for Federal Government Relations testified in Congress about the impact this new rule would have on small businesses. In November, NFIB urged Congress to delay the implementation of these sweeping reporting requirements.