Cohousing-L Mailing List: Corporate Transparency Act

[Diane Puntenney (diane]

Our Vice President contacted FinCEN with questions about filing for an 
HOA where all owners are directors. He received the following response. 
Note that we (Phoenix Commons) can't take responsibility for the 
accuracy of the information or its relevance to any particular 
situation. Each HOA should contact FinCEN directly with questions.

Diane Puntenney, Phoenix Commons

-------- Forwarded Message --------
Subject: 	[finance] Fwd: Ticket Resolution: 00113660 - 
ref:_00D00D820000008fN6._500500SJ000005eztF:ref
Date:   Fri, 6 Sep 2024 14:49:44 -0700
From:   finance <finance [at] phoenixcommons.cohousing.site>
Reply-To:       Gregory Reichert <gregoryareichert [at] gmail.com>
To: 	officers <officers [at] phoenixcommons.cohousing.site>, Finance 
<finance [at] phoenixcommons.cohousing.site>



posted by Greg Reichert
Hi All - Great news! I submitted my questions on the Corporate 
Transparency Act about noon and got a phone call followed by this email 
as back up.

As I read it, if we are not an HOA recognized by the IRS as section 
501(c) (4) social welfare organization, we will have to file but only 
for a limited number of individuals. We can discuss who at our meeting. 
See highlighted sections below:

*_Who is the beneficial owner of a homeowners association? _*

*A homeowners association (HOA) that meets the reporting company 
definition and does not qualify for any exemptions must report its 
beneficial owner(s). A beneficial owner is any individual who, directly 
or indirectly, exercises substantial control over a reporting company, 
or owns or controls at least 25 percent of the ownership interests of a 
reporting company. *

There may be instances in which no individuals own or control at least 
25 percent of the ownership interests of an HOA that is a reporting 
company. However, FinCEN expects that at least one individual exercises 
substantial control over each reporting company. Individuals who meet 
one of the following criteria are considered to exercise substantial 
control over the HOA:

 * the individual is a senior officer;
 * the individual has authority to appoint or remove certain officers
   or a majority of directors of the HOA;
 * the individual is an important decision-maker; or
 * the individual has any other form of substantial control over the HOA.

*_Is a member of a reporting company’s board of directors always a 
beneficial owner of the reporting company?_*

*No. A beneficial owner of a company is any individual who, directly or 
indirectly, exercises substantial control over a reporting company, or 
who owns or controls at least 25 percent of the ownership interests of a 
reporting company. *

Whether a particular director meets any of these criteria is a question 
that the reporting company must consider on a director-by-director basis.

Greg
---------- Forwarded message ---------
From: *Contact Center No-Reply* <noreply.contactcenter [at] fincen.gov>
Date: Fri, Sep 6, 2024 at 12:21 PM
Subject: Ticket Resolution: 00113660 - 
ref:_00D00D820000008fN6._500500SJ000005eztF:ref
To: gregoryareichert [at] gmail.com <gregoryareichert [at] gmail.com>



*Subject*       Ticket Resolution: 00113660
*Date/Time*     
9/6/2024, 02:21 PM EST
*Details*       Dear Gregory Reichert,

*Thank you for contacting FinCEN. You are receiving this response for 
ticket number **00113660.*

*We believe your question relates to:***

1. *_Are homeowners’ associations and housing cooperatives required to
   report beneficial ownership information?_*
2. *_Is a member of a reporting company’s board of directors always a
   beneficial owner of the reporting company?_*
3. *_Do I need to update my information?_*

*_Are homeowners’ associations and housing cooperatives required to 
report beneficial ownership information?_*

*As with any entity, if a homeowner’s association (HOA) or housing 
cooperative was not created by the filing of a document with a secretary 
of state or similar office, then it is not a domestic reporting company 
and is not required to report beneficial ownership information to FinCEN.*


An HOA or housing cooperative that is formed under the laws of a foreign 
country and not registered to do business in the United States by the 
filing of a document with a secretary of state or similar office is not 
a foreign reporting company and is not required to report beneficial 
ownership information to FinCEN.

However, if an HOA or housing cooperative was created or registered to 
do business in the United States by the filing of a document with a 
secretary of state or similar office, then it would be a reporting 
company that is required to report beneficial ownership information to 
FinCEN, unless an exemption from the reporting requirements applies.

Importantly, an HOA that was created or registered to do business in the 
United States by such a filing may qualify for an exemption from the 
reporting requirements. For example, HOAs recognized by the IRS as 
section 501(c) (4) social welfare organizations (or that claim such 
status and meet the requirements) may qualify for the tax-exempt entity 
exemption. An incorporated HOA that is not a section 501(c)(4) 
organization, however, may fall within the reporting company definition 
and therefore be required to report BOI to FinCEN.

*_Who is the beneficial owner of a homeowners association? _*

*A homeowners association (HOA) that meets the reporting company 
definition and does not qualify for any exemptions must report its 
beneficial owner(s). A beneficial owner is any individual who, directly 
or indirectly, exercises substantial control over a reporting company, 
or owns or controls at least 25 percent of the ownership interests of a 
reporting company. *

There may be instances in which no individuals own or control at least 
25 percent of the ownership interests of an HOA that is a reporting 
company. However, FinCEN expects that at least one individual exercises 
substantial control over each reporting company. Individuals who meet 
one of the following criteria are considered to exercise substantial 
control over the HOA:

 * the individual is a senior officer;
 * the individual has authority to appoint or remove certain officers
   or a majority of directors of the HOA;
 * the individual is an important decision-maker; or
 * the individual has any other form of substantial control over the HOA.

*_Is a member of a reporting company’s board of directors always a 
beneficial owner of the reporting company?_*


*No. A beneficial owner of a company is any individual who, directly or 
indirectly, exercises substantial control over a reporting company, or 
who owns or controls at least 25 percent of the ownership interests of a 
reporting company. *

Whether a particular director meets any of these criteria is a question 
that the reporting company must consider on a director-by-director basis.

/FinCEN’s Small Entity Compliance Guide, available at 
fincen.gov/boi/small-entity-compliance-guide, 
<http://fincen.gov/boi/small-entity-compliance-guide,> includes 
additional information on how to determine if an individual qualifies as 
a beneficial owner in Chapter 2, “Who is a beneficial owner of my 
company?”. This chapter includes separate sections with more information 
about substantial control and ownership interest: Chapter 2.1 “What is 
substantial control?” and Chapter 2.2 “What is ownership interest?” /


*_Do I need to update my information?_*

*An updated report must be filed within 30 days of any change in a 
reporting company or beneficial owner’s required information. *

The following are some examples of the changes that would require an 
updated beneficial ownership information report:

 * Any change to the information reported for the reporting company,
   such as registering a new business name.
 * A change in beneficial owners, such as a new CEO, or a sale that
   changes who meets the ownership interest threshold of 25
   percent (see BOI FAQ Question D.4 for more information about
   ownership interests).
 *   Any change to a beneficial owner’s name, address, or unique
   identifying number previously provided to FinCEN. If a beneficial
   owner obtained a new driver’s license or other identifying document
   that includes a changed name, address, or identifying number, the
   reporting company also would have to file an updated beneficial
   ownership information report with FinCEN, including an image of the
   new identifying document.

FinCEN’s */Small Entity Compliance Guide 
/*(fincen.gov/boi/small-entity-compliance-guide) 
<http://fincen.gov/boi/small-entity-compliance-guide)> provides 
additional guidance on triggers requiring an updated beneficial 
ownership information report (see Chapter 6.1 “What should I do if 
previously reported information changes?”).

*Individuals must update or correct the information they submitted to 
obtain a FinCEN identifier through the FinCEN identifier application 
that is also used to request a FinCEN identifier. *

Individuals must report any change to the information they submitted to 
obtain a FinCEN identifier no later than 30 days after the date on which 
the change occurred.

If there is any inaccuracy in this information, an individual must 
correct the information no later than 30 days after the date the 
individual became aware of the inaccuracy or had reason to know of it.

Reporting companies with a FinCEN identifier must update or correct the 
company’s information by filing an updated or corrected beneficial 
ownership information report, as appropriate.




*In the event your inquiry was not resolved by the provided response, 
please reply to this email within seven (7) business days from the date 
of this email. This ticket will be closed after seven (7) business days.*

*_____________________________________*
*
*


Thank you,


The Beneficial Ownership Contact Center
Financial Crimes Enforcement Network (FinCEN)
Hours of Operation are 9AM to 5PM EST Monday through Friday

*Please note that the reporting requirements for certain individuals and 
entities have been affected by a federal court ruling.  More information 
about this ruling and to whom it applies is available on our website 
(fincen.gov/boi <http://fincen.gov/boi>).*

*The information provided in this response does not, and is not intended 
to, constitute legal advice. All information, content, and guidance 
provided by or through the Beneficial Ownership Contact Center is for 
general informational purposes only, does not supplement or modify any 
obligations imposed by statute or regulation, and does not supersede 
more recent guidance issued by FinCEN. FinCEN may revise, clarify or 
update the information, content, and guidance provided by and through 
the Beneficial Ownership Contact Center. Any links or references to 
third party websites are provided only for your convenience and the 
provision of those links does not, and is not intended to, constitute an 
endorsement or approval of any third party content. FinCEN is not 
responsible for the content or privacy practices of third party websites.*
*
*
*FinCEN may monitor or retain this correspondence, and any information 
provided during this correspondence, to help improve and personalize 
your experience. For more information, see our Privacy Policy.*
*Ticket Information*
        
Ticket Number: 00113660
Subject: Other / General Beneficial Ownership Questions