Changes in IRS Reporting for LLCs
The IRS, along with other federal agencies, has rolled out important updates to how Limited Liability Companies (LLCs) report ownership. The biggest change comes from the Corporate Transparency Act (CTA), which started in 2024. This law tightens the rules on how owners and decision-makers of LLCs must be tracked and reported to the federal government.
Beneficial Ownership Information (BOI) Reporting
Thanks to the CTA, most small and privately held LLCs must now provide Beneficial Ownership Information (BOI) to the Financial Crimes Enforcement Network (FinCEN). This report is designed to shine a light on who really owns the company. LLCs must list the full name, date of birth, residential address, and identification number (like a driver’s license or passport number) for anyone who either owns 25% or more of the LLC or has significant decision-making powers.
The deadlines for these filings are straightforward:
- LLCs formed before January 1, 2024, must file by January 1, 2025.
- New LLCs that start in 2024 must file within 90 days of when they get their formation approval.
- LLCs that form in 2025 or later must file within 30 days of their registration.
LLCs also need to keep the BOI filings current. If there’s a change in ownership or control, they must update the report within 30 days.
Updated Beneficial Ownership Information Rules and Exemptions
In March 2025, FinCEN issued an interim final rule that changed the BOI reporting requirement. The main updates are:
- U.S. domestic limited liability companies (LLCs) formed in the U.S. no longer need to file BOI reports.
- Now the requirement applies only to foreign entities registered to do business in the U.S.
- U.S. citizens and residents who own foreign entities are exempt from filing under the new rules.
The revised rule became effective in late March 2025. Now foreign entities must meet the new BOI filing deadlines. FinCEN also stated that domestic entities that used to be required to file will face no enforcement actions or penalties.
Other IRS Filing Requirements
Besides the updates to the BOI rules, traditional IRS tax rules for LLCs are the same:
- Single-member LLCs are still treated as disregarded entities and must file Schedule C with their Form 1040.
- Multi-member LLCs must file Form 1065 and send K-1s to their members.
- LLCs that choose S-corporation status must file Form 1120S.
Conclusion
Federal tax-reporting rules for LLCs are mostly unchanged, but the new—and now partly canceled—BOI rule signals significant change. LLC owners need to keep up to date and work with legal or tax advisors to meet shifting rules and stay compliant.
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