In Week Five of our CTA Series, we’re exploring the intricacies of inactive entities exempt from BOI
reporting. According to FinCen, specific criteria must be met for an entity to qualify as inactive. Let’s dive
into these criteria and unravel the essentials.

1. The entity was in existence on or before January 1, 2020.

2. The entity is not engaged in active business.

3. The entity is not owned by a foreign person, whether directly or indirectly, wholly or partially.
“Foreign person” means a person who is not a United States person. A United States person is
defined in section 7701(a)(30) of the Internal Revenue Code of 1986 as a citizen or resident of
the United States, domestic partnership and corporation, and other estates and trusts.

4. The entity has not experienced any change in ownership in the preceding twelve-month

5. The entity has not sent or received any funds in an amount greater than $1,000, either
directly or through any financial account in which the entity or any affiliate of the entity had
an interest, in the preceding twelve-month period.

6. The entity does not otherwise hold any kind or type of assets, whether in the United States or
abroad, including any ownership interest in any corporation, limited liability company, or
other similar entity.

If you meet ALL 6 of the above criteria, you are NOT required to file a BOI report.

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