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Identifying Trusts That Need to File BOI Reports




July 30, 2024


Under the Corporate Transparency Act, certain kinds of trusts must file Beneficial Ownership Information Reports (BOIRs), but not all. The key factor in determining this requirement is how the trust was formed.


If a trust was formed by filing documents with a Secretary of State, it is required to report. On the other hand, if the trust's existence was established solely through the execution of a trust agreement without state involvement, it is not considered a "reporting company" – the technical term used by FinCEN for entities that are required to file. For example, statutory trusts and business trusts can be created by filing formation documents. Some states require it for formation, and others don't.


When determining the beneficial owners of a reporting company owned by a trust, it is essential to identify individuals with ownership or control over the trust’s ownership interests. Depending on the trust's mechanics, this could include the trustee, investment advisor, trust protector, or a beneficiary.


FinCEN offers a comprehensive set of FAQs covering various BOI topics, including trusts, which can be accessed here.


For more information or to discuss your specific circumstances, please reach out to us at cta@freidel.tax.

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