Puerto Rico Entities Must Comply with Beneficial Ownership Information Reporting Requirement
The U.S. Department of Treasury’s Financial Crimes Enforcement Network (FinCEN) has issued a final rule requiring certain entities in Puerto Rico to report beneficial ownership information. The Corporate Transparency Act aims to combat financial crime by mandating that beneficial ownership information is reported to FinCEN.
Who is Subject to the Reporting Requirement?
Puerto Rico is included under the definition of “State,” making it subject to the beneficial ownership reporting requirement. This means that legal entities registered with the Puerto Rico Department of State must file a report with FinCEN, unless an exception applies.
Timeline for Filing Initial Reports
The reporting requirement will apply to entities created or registered in Puerto Rico on or after January 1, 2024, which will have 30 days to file their initial report. Entities created before this date will have until January 1, 2025, to file their initial report.
Who is a Beneficial Owner?
A beneficial owner is defined as an individual who exercises substantial control over the reporting company or owns at least 25% of its ownership interests. Company applicants, on the other hand, are limited to two individuals:
- The person who files the document creating or registering the company
- The person primarily responsible for directing or controlling the filing
Information Required in the Report
The report will require the following information:
- Reporting company’s full legal name, trade names, and dbas
- Complete current address of its principal place of business
- Jurisdiction of formation (state or foreign)
- Employer Identification Number (EIN), Taxpayer Identification Number (TIN), or foreign identification number
- Beneficial owner’s full legal name, date of birth, current residential address, unique identification number, and issuing state or jurisdiction
- Company applicant’s information, including business address if applicable
What Should Puerto Rico Entities Do?
Puerto Rico entities subject to the reporting requirement should review these rules and determine an action plan to ensure compliance. If you need additional information or advice on these matters, contact our tax advisors at:
(787) 751-6164 | email protected
We are here to help you navigate the new regulations and ensure your entity is compliant with the beneficial ownership reporting requirement.