522: FINCEN and Florida
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Are you ready to comply with the latest FINCEN regulations that impact your pet care business? In this episode, we break down the new Beneficial Ownership Information reporting requirements and why they're crucial for staying on the right side of the law. We also explore how Florida's regional pet care groups are leading the way in building strong local networks and supporting pet sitters. Plus, we discuss the growing maturity of the pet care industry and what it means for business owners like you. Tune in for practical tips on filing with FINCEN and keeping your business compliant.
Main topics:
FINCEN Reporting Requirements
Compliance and Penalties
Florida Pet Care Associations
Pet Care Industry Growth
Filing Process Overview
Main takeaway: Local and regional networks set a new standard by fostering hyper-local connections, ensuring that pet sitters can share resources and tackle unique local challenges together.
Links:
FINCEN BOI Reporting - This is the direct link to the official page where businesses can learn more and file their Beneficial Ownership Information.
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A VERY ROUGH TRANSCRIPT OF THE EPISODE
Provided by otter.ai
SUMMARY KEYWORDS
fincen, pet sitters, business, file, company, pet, beneficial ownership, people, work, sitters, state, information, comply, florida, industry, organizations, registered, control, important, sounds
SPEAKERS
Meghan, Collin
Meghan 00:02
Hi, I'm Megan, I'm Collin, and we are the host of pet sitter confessional, an open and honest discussion about life as a pet sitter. We appreciate you joining us today. We also want to thank pet sitters associates for sponsoring today's episode, and thank our Patreon supporters. They like what we do, and if that sounds like you too, you enjoy the podcast and get value from them. You can go to pet sitter, confessional.com/support, to see all of the ways that you can keep the show going. We recently attended the Florida Pet Services Association Summit where Collin got to give a presentation, and it went phenomenally well. Thank
Collin 00:33
you very much. It was a lot of fun to give.
Meghan 00:35
We had a whirlwind of connecting with others, and Collins talk went really well, but it got us thinking about the future of pet care from the perspective of community involvement. What Florida and their association are doing really well is that they have regional directors, so they broke out Florida into different sections, and each one has their own director. So it's not even just a state level organization. They have various regions around the state, where, if you're a pet sitter in that region, you can call up your director and say, Hey, I really need some help with this. Or can I bounce an idea off of you? And how do you think this sound? We think this is very important because it makes connections. You are networking with others in your community. It
Collin 01:16
really brings people together over common causes. Makes it easier to organize events and structures and policies and procedures, and allows a lot more fluid communication and supporting one another, as opposed to long distance. I mean, social networking and the internet are fantastic for bringing large groups together, but genuinely, nothing beats working together, boots on the ground, together in your local area, making your businesses better, learning and growing together.
Meghan 01:46
When you do have that hyper local organization, they are there to help you succeed, provide resources and really are advocates for you. Means that the industry is robust and maturing. We think that this should really happen in every state, but this maturing and the advocating and the resources didn't really come from nothing. I mean, you can ask any of the organizers of the Florida summit or Texas has their own Association. These people work really hard. They volunteer their time, and they would tell you that it takes a lot of work to get this thing off the ground, to get this going year after year. If you are looking for connections and support. It may mean that you have to create it. You may be the one in your local community saying, hey, pet sitters and dog walkers, let's get together and meet up maybe once a quarter so we can share resources and business tips to elevate everybody. Yeah,
Collin 02:34
it's that growing and maturing as an industry. More people are in business longer than ever. More people are running larger businesses than ever. There are more resources than ever. But it takes working together to make these things work. And by creating these local organizations, these state level and regional level directors, it is actually creating more opportunities for leadership in the industry as well. There are more people in the industry than ever before, meaning there are more skill sets, there are more passions, there are more directives that people are wanting to bring into the industry that can be used to make it better, so elevating people into positions where they can make decisions, where they can help be leaders, where they can help guide and train and bring up other people. This only is possible because of the level that the industry is at right now.
Meghan 03:22
Yeah. I mean, we know how important insurance is. It's vital to running a business. You have to protect yourself, but it's likely that new people coming into the industry don't know about it. So if you can be part of the education process of making the industry as a whole better, but by starting in your local community, that can only help everybody exactly.
Collin 03:40
And again, if you are looking to your surrounding area and going, well, there's nothing here for me. Instead of waiting for somebody else to do it, I think we really do have to look ourselves in the mirror and go, Is it me? Is it my responsibility? Am I able to do this on now, not everybody is able to take that on because of where they are in their business, where they are in their personal life, their goals, their desires, all that goes into play. But until we ask that question of their self, of ourselves and go, I just need to be a little bit of self reflective here and go, Okay, I want something. Am I the one to actually do that? And you may find that the answer is is yes, which is scary and terrifying. You can ask anybody from Florida or Texas or any of the other state organizations. It's terrifying to go into that, but it's so needed, and we really, really hope that this can more, more organizations like this can spread across the country, bringing regional people together, focusing on hyper local, relevant problems and concerns and legislation and health risks and all that stuff, so that we can all be better when we share together. Wouldn't it
Meghan 04:44
be great if one day every state had their own organization, local connections, local meetings, get local support and networking. You know, national organizations like the National Association of Professional pet sitters and pet sitters international are great. They serve the purpose of moving. Entire industry ahead, looking at the big picture, the 30,000 foot view of where are we going, where what our client demands. How can we adapt to an economy, a changing economy? But state organizations can do something that national organizations can't. State organizations can speak directly to the local laws and regulations, local business connections, the local economy, local problems pet sitters face. Florida has hurricanes. Arizona doesn't deal with that. Texas has Chagas disease. California has very specific set of labor laws that most states don't comply with. Each State really does have their own unique challenges, but that's a benefit to the pet sitters in the local community, because they can come together and say, Hey, we can face these challenges head on, because we are all dealing with them. We can all have a hive mind and come up with solutions. And
Collin 05:48
for our international listeners, you know, Australia has their own suite of conditions and problem sets they're trying to overcome. The Netherlands have their own, you know, policies and procedures and oversight that they are trying to work with and make sure that their businesses are in compliance with. When we have local resources to get connected to and plugged in with, we can bounce ideas off of other business owners to say, okay, like this new legislation just came down, or there's this new thing that we're trying to deal with. How are you adapting your business to fit that? Or what are we doing with about all of this rain or all of these new invasive species that the dogs are trying to eat or or whatever the problem is, we can bounce ideas off of other people. It's hard to do that when people have no idea what you're actually trying to experience. They have no idea what it's like to run a business in South Africa because they don't run a business in South Africa, so we need to talk with other people in our area, and that allows us and them to grow faster, because now what we've done is we've created a fast feedback loop, a positive feedback loop mechanism where our own wins are going to support other people's wins, which then go back to support us in our wins, And we work together to make everybody
Meghan 07:01
better. But yes, taking on something as big as this is very scary. So if you think that you are the one, go and talk to the organizers of the Texas pet sitters Association, go and talk to the Florida Pet Services Association. Go and talk to the organizers of these because they can guide you through your journey. I mentioned the importance of insurance earlier, but as pet care professionals, your clients trust you to care for their furry family members, and that's why pet sitters Associates is here to help. For over 20 years, they have provided 1000s of members with quality pet care insurance. Because you work in the pet care industry, you can take your career to the next level with flexible coverage options, client connections and complete freedom in running your business. Learn why pet sitters Associates is the perfect fit for you and get a free quote at petsit llc.com you can get a discount when you join by clicking membership Pet Sitter confessional and use the discount code confessional when you go to checkout. Check out the benefits of membership and insurance. Once again at petsit llc.com on episode 521 we had interviewed Lindsay Roberts of harquin bookkeeping, and she talked all about how to be more profitable with better bookkeeping practices. One thing that she did mention that we want to expand on is FinCEN. Now, this is going to be pretty dry, but please don't tune out, because it is super important for anybody who lives in the United States, and must be done by the end of 2024
Collin 08:13
Yeah, we have a lot more notes on this, because it's very technical, and there are specifics that we don't want to get wrong, but however, remember, we are not tax professionals. We are not lawyers in this. We are just small business owners trying to figure out this, just like you. So, FinCEN, there are two things here. There's fence in and then there's the beneficial ownership information reporting. So what in the world is, FinCEN, this is the Financial Crimes Enforcement Network. It already sounds fun, doesn't it, right? No,
Meghan 08:41
it sounds very scary.
Collin 08:42
This is a Bureau of the US Department of the Treasury, and its primary mission is actually to combat money laundering, terrorist financing and other financial crimes. It's sounding even better now, isn't it, and they actually collect and analyze financial transaction data to attempt to detect and prevent illegal activities, and they work closely with law enforcement and financial institutions to ensure the integrity of the entire US financial system. Now, recently, there was the beneficial ownership information or boy boi. This is a new requirement, and came out of a new regulation issued by FinCEN that impacts small businesses and other legal entities. But this rule is part of the corporate Transparency Act, and we've so many acronyms here. This is designed to enhance transparency in business operations and help prevent illicit activities like who knows, money laundering and tax evasion. So FinCEN needed a way to better understand and better detect illegal activities, and part of that is the beneficial ownership information requirement. Starting in 2024 most US companies will be required to report information about their beneficial owners to FinCEN and a beneficial owner. Is defined as an individual who, directly or indirectly owns 25% or more of the company and exercises substantial control over the company, such as decision making, authority or influence over major decisions. So
Meghan 10:14
basically, all of us pet sitters and dog walkers, if you are
Collin 10:18
a sole proprietor, you have to file the beneficial ownership information report, because you own 100% of the company, and you make substantial control in decisions over your business. If you have a business partner and you're 5050, or maybe you're 7525 or maybe you're 30% 30% whatever those percentages are, right? If you if you meet those requirements, you have to file one of these because FinCEN wants to know who is actually owning and operating and influencing decisions of US businesses. This is
Meghan 10:50
really going to affect small businesses partially because they want to identify the beneficial owners. They want to determine who qualifies as an owner in your company. It could be just you or multiple partners, we then have to submit that required information about who the owners are to FinCEN. It includes personal details like full name, date of birth, address and then a driver's license or passport number. But even though we submit that information, our work isn't done because we have to maintain accurate and up to date records if anything changes in the business ownership. So if you are sole and you bring on a partner, or you change percentages of the partnership in your business, that needs to be updated to FinCEN, or maybe
Collin 11:31
you sell your business, you then have to report who is now controlling that entity. It's another and then who knows what other legislation and reporting requirements are going to come out year after year, as they grow and adapt and as they change the requirements for this. Why is this important? Right? We already alluded to this, but this new reporting requirement aims to increase transparency and accountability in the corporate world, and it is frustrating, because, yes, we as small businesses, we have to report just like Coca Cola does, just like Apple does, by knowing who ultimately owns and controls companies, FinCEN can better detect and prevent financial crimes. And for small businesses like us, complying with this new rule is crucial to do things like avoid penalties, ensure that your business operations remain in good standing with federal regulations. It's also an important opportunity to review how your business is set up, what's the structure of your business, and make sure that everything is properly documented. A lot of times, we set up a business and then we just set it and forget it, and we don't actually update records or don't update reporting internally to understand who is making decisions and how are things set up. However, this is a great opportunity to review and go, Okay, what actually is going on, and who is actually making decisions and and do I need to make other changes
Meghan 12:47
if you are interested in not complying with this? Well, well, good luck, because you are in for civil penalties. Businesses that do not file the required boi reports could be fined heavily. Of course, there's also criminal penalties. If you don't want to go to jail, you should probably file. Then there's the increased scrutiny. Nobody wants a potential audit from the IRS, but if you don't file, you're in for that too, potentially. Then there's
Collin 13:12
just reputational damage. Right? Failing to comply with these kind of regulations can harm your business's reputation. It might impact relationships with clients or partners or financial institutions who may view your business as not reliable. So there are just a lot of consequences for not filing or not filing correctly.
Meghan 13:29
If you do want to file, you can go to fincen.gov/boi, so that's f, i, n, C, E, N, dot, G, O, V, slash, B, O, I, and you
Collin 13:38
will need a litany of information. First, you're going to need the legal name of the company. This is the official name that's registered with your state or jurisdiction. Also make sure that you have your primary address for where your company conducts business and where, again, where you're registered. You'll need the state of formation or your jurisdiction where you're registered. And then that tax identification number. It's either going to be in the United States again, it's either going to be your personal social security number if you are a sole proprietor, or you're going to have that employee identification number that ein that you had to get when you registered with the IRS. Then for each
Meghan 14:12
beneficial owner of the company, you're going to need their full legal name, date of birth, residential address, unique identifying number and a percentage of the ownership and control information if you are a sole prop, this is pretty easy. You know all of this about yourself,
Collin 14:27
but that control information is actually a little bit tricky here, because let's say that somebody doesn't own over that 25% of the of the business, but they do exert a lot of control over the business, because it could be financially, it could be relationally, it could be whatever. You do have to describe how this person exerts control over your company. So
Meghan 14:48
again, you're going to need to go to that website, fincen.gov/boi, to fill out the form electronically. And you have to do so by the end of 2024,
Collin 14:56
for existing entities, again for existing. Entities. The deadline is one year after the regulations go into effect, and for new entities. So let's say you're an existing company. You have one year when it goes into effect, which is the end of this year, end of 2024 However, any new business that registers, and this is important as a lot of us start to look at doing other kind of entities, or branching off our businesses, or maybe you're listening to this and you haven't gone into business yet, and you're just gathering information. Know that when you register your business, you have 30 days after your formation or your registration process to file this information with the federal government. So more paperwork. Yay. Who doesn't love that? And then again, be aware of any ongoing compliance. Update things regularly. Keep an eye on the new regulations as they may add or subtract filing requirements or information required for those beneficial owners.
Meghan 15:54
But this really shouldn't take very much time, probably 10 minutes at most, if you have all the paperwork in front of you ready to go absolutely.
Collin 16:00
And towards the very end of this process, there can be a screen that will ask you to review all of your information, and then at the bottom, you need to select Submit. Make sure that you go through this process and hit that last button and not close out of that window, because if you do, you will have not filed, and you will have to go through the entire process again. So make sure you get that good confirmation screen and that confirmation email to your registered business email so that you can save that for your records.
Meghan 16:25
If you filed you can let us know how easy it was or painful by emailing us at petsitter confessional@gmail.com we appreciate you listening to our musings today, and thank you also to pet sitters associates for sponsoring today's episode. We will talk with you next time bye, you.
