02.02.2024 | Webcasts & Podcasts

Navigating The Corporate Transparency Act Webinar | 2.2.24

00:02:57.000 –> 00:03:03.000
Good morning, folks. This is Ed Alcock from Allcock Marcus.

00:03:03.000 –> 00:03:14.000
Welcome to the webinar navigating the corporate transparency act. I’m gonna give it 2 min. Just to allow, additional people.

00:03:14.000 –> 00:03:26.000
To join. Sometimes there’s a little bit of a highway backup, if you will, when People are jumping on the zoom at, 10 am.

00:03:26.000 –> 00:03:39.000
This program is being recorded. And we have a PowerPoint. If anybody wants. A copy of the PowerPoint or the recording.

00:03:39.000 –> 00:03:48.000
You can email me. At ed@amcondolaw.com.

00:03:48.000 –> 00:04:02.000
Or you can simply type in the chat with your information And we can provide it after the webinar is over.

00:04:02.000 –> 00:04:15.000
Happy Groundhog Day to everybody too. I’m told that, for the first time in many, many years did not see his shadow today.

00:04:15.000 –> 00:04:39.000
So, apparently we get 6 weeks of spring.

00:04:39.000 –> 00:04:48.000
Alright, we’re at 1001. I still see participants. Jumping in and it’s kind of a function of zoom it just takes people a while to get into the thing.

00:04:48.000 –> 00:05:18.000
I’ll get started in another minute. Or 2.

00:05:43.000 –> 00:05:50.000
Alright folks, so it’s now 1002. I see we’ve got Participants still coming in.

00:05:50.000 –> 00:06:02.000
Let me reintroduce myself. My name is at all. I am a partner at the law firm of Alcock and Marcus.

00:06:02.000 –> 00:06:14.000
We primarily represent condominium associations. And practice condominium law in. Massachusetts, Rhode Island.

00:06:14.000 –> 00:06:25.000
No Hampshire, Maine. And Florida. So like I like to call that New England. And I consider Florida to be.

00:06:25.000 –> 00:06:37.000
Southern, New England. As I mentioned, on the at the beginning

00:06:37.000 –> 00:06:47.000
We do have a PowerPoint. This session is being recorded. If you’d like to get a copy of the PowerPoint or the recording.

00:06:47.000 –> 00:07:00.000
You can either email me. At ed@amcondolaw.com Or you can simply type in the chat and we will get it to you.

00:07:00.000 –> 00:07:08.000
After the webinar is finished. During the course of the webinar. I welcome you to use the chat function.

00:07:08.000 –> 00:07:16.000
And, if you have any questions, I’ll try to answer them. As I go.

00:07:16.000 –> 00:07:32.000
And if not, if I don’t answer your question. You can feel free to email me@amcondolaw.com so The the topic of today’s webinar.

00:07:32.000 –> 00:07:41.000
Something I don’t think I ever thought I’d be talking about as a condominium lawyer.

00:07:41.000 –> 00:07:51.000
Navigating the corporate transparency act. What is the corporate transparency act? It’s an act.

00:07:51.000 –> 00:08:05.000
That was put into place by congress in 2,001 and has only begun to have any sort of real meaning.

00:08:05.000 –> 00:08:21.000
Because reporting for certain reporting entities, corporations. Llc’s. And other applicable entities, which I’m going to say for the most part involves condominium associations.

00:08:21.000 –> 00:08:30.000
Begins in. 2024. So let’s talk about. What that actually entails.

00:08:30.000 –> 00:08:43.000
And what it’s about. So there’s a department. Of the US Treasury that’s called what I like to call them.

00:08:43.000 –> 00:08:56.000
It’s the financial crimes enforcement network. The The issue, what this is supposed to deal with.

00:08:56.000 –> 00:09:08.000
Is to expand and fight. Anti money laundering efforts. Terrorist financing, corruption, tax fraud.

00:09:08.000 –> 00:09:21.000
And other illicit activity. The concept, the idea is. That individuals are using. Non publicly traded corporations or LLCs.

00:09:21.000 –> 00:09:33.000
To launder money, whether it’s whether it’s foreign interests, terrorist interests. And, commit otherwise elicit crimes.

00:09:33.000 –> 00:09:41.000
Using shells like Llc’s. Corporations. Some of which have a lot of money running through them.

00:09:41.000 –> 00:09:53.000
And you can’t really tell who’s Who’s involved or who the beneficial owners are. Of some of these smaller entities.

00:09:53.000 –> 00:10:01.000
Now I say smaller. And we’ll get into it in a bit because there are numerous exemptions.

00:10:01.000 –> 00:10:09.000
For entities that have. Other reporting requirements like, publicly traded corporations, charities, so forth.

00:10:09.000 –> 00:10:23.000
So the concept is Congress is requiring non-exempt reporting entities. To provide. The name of the entity.

00:10:23.000 –> 00:10:34.000
To FINCIN, to FINCIAN database. And. Information about who owns or controls.

00:10:34.000 –> 00:10:44.000
These entities. And the information is specific. It’s It’s, taxpayer ID number for the entity.

00:10:44.000 –> 00:10:53.000
The address of the entity, the name of the entity. And then the identities of the beneficial owners.

00:10:53.000 –> 00:11:05.000
Their date of birth. They’re residential address. And then here’s kind of what I consider to be the most interesting part.

00:11:05.000 –> 00:11:11.000
There. ID number issued by the state in which they live or if they don’t live in the United States.

00:11:11.000 –> 00:11:28.000
An ID number issued by the state they live outside the United States. Together with a state issued photo graphic.

00:11:28.000 –> 00:11:34.000
ID card, either a driver’s license, or if you don’t have a driver’s license.

00:11:34.000 –> 00:11:45.000
A state issued identification card that has The number, you know, the the that same ID number on it.

00:11:45.000 –> 00:11:56.000
I know in Massachusetts several years ago. I used to have my social security number. On my, license.

00:11:56.000 –> 00:12:06.000
They change that. Actually, they forbid it. They now give you a, a generic, number that is not your social security number.

00:12:06.000 –> 00:12:19.000
So when you Register with Vincent. When a beneficial owner registers they have to punch in the ID number and then also download a photographic copy.

00:12:19.000 –> 00:12:32.000
Of their drivers license. We just switch to the next slide here. Oops.

00:12:32.000 –> 00:12:44.000
So. They the supposed or stated purpose of this law again. Is to.

00:12:44.000 –> 00:12:57.000
Combat terrorism combat. Illicit crimes, money laundering. You know, for Llc’s corporations that have a lot of money that.

00:12:57.000 –> 00:13:10.000
Runs that runs through them. I actually believe that there’s a little bit of an underlying purpose.

00:13:10.000 –> 00:13:21.000
Behind the act. I think the government in this case is building a database they want as many names as they can.

00:13:21.000 –> 00:13:30.000
Into this database. And I believe it’s. It’s one of the starts of a facial recognition.

00:13:30.000 –> 00:13:38.000
Database. Might even be you know sort of a test run. And I’ll tell you kind of a funny.

00:13:38.000 –> 00:13:49.000
Story about, the government and facial recognition. About a month ago. I, I went on a trip to Florida.

00:13:49.000 –> 00:13:59.000
Quick quick little jaunt down. And I flew out of Logan Airport. And like many of you, I’ve gone through all the trouble to get one of these.

00:13:59.000 –> 00:14:06.000
Real IDs. So my drivers license has that little stamp on it. I had a supply.

00:14:06.000 –> 00:14:17.000
18 documents to the Massachusetts Registry of Motor Vehicles. In order to get that real idea, to go get a birth certificate, how to show them like a utility bill, all kinds of stuff for them to verify.

00:14:17.000 –> 00:14:27.000
That was me. And that’s where I lived. So I go to the airport and I get into the security line.

00:14:27.000 –> 00:14:32.000
And I don’t know if anybody’s flown recently, but it’s a little different now.

00:14:32.000 –> 00:14:41.000
Instead of just going up to the to the person and showing them your drivers license They ask you to put it in a machine.

00:14:41.000 –> 00:14:45.000
And, and so I put it in this machine. It gets, it gets sucked into the machine.

00:14:45.000 –> 00:14:57.000
They asked me to stand back and they take a photograph of me. And the reason they’re doing that is is because they have a facial recognition program.

00:14:57.000 –> 00:15:05.000
On the computer at at the airport security. And they want to match up the picture of your face. With the picture of your face on your license.

00:15:05.000 –> 00:15:13.000
Well, For whatever reason, I was sitting there and they’re like, sir, it’s not working.

00:15:13.000 –> 00:15:20.000
Can you? In your put your chin up. But whatever reason it might. In my drivers license picture, my chin is up.

00:15:20.000 –> 00:15:24.000
So like, oh, can you move like this? Can you move your head? So we kept doing it.

00:15:24.000 –> 00:15:31.000
They must have taken. 10 photographs of me and finally the lady says, sir, it doesn’t seem to be working.

00:15:31.000 –> 00:15:36.000
Can you stand over there? So. You know, I’m trying to get through security.

00:15:36.000 –> 00:15:44.000
They move me aside. I’m standing over in line here aside. And then it happens to another guy.

00:15:44.000 –> 00:15:53.000
And he’s standing next to me. And within moments, the 2 of us are sort of planning our own little insurrection at the airport.

00:15:53.000 –> 00:16:00.000
Because we’re like, what is the point of us getting this real ID? If it doesn’t get us through the security line.

00:16:00.000 –> 00:16:09.000
And then you know, maybe about 20 min later. A woman comes over, looks at our IDs, looks at our faces.

00:16:09.000 –> 00:16:22.000
And finally lets us go. I found that to be very interesting. And I think, you know, the with the advent of artificial intelligence.

00:16:22.000 –> 00:16:31.000
I think that’s kind of where we’re going. And I think it’s kind of interesting that that the governments already involved in it.

00:16:31.000 –> 00:16:36.000
That’s why they want. The. That’s why they want the licenses.

00:16:36.000 –> 00:16:55.000
And again, I think here. It’s it’s for a legitimate purpose. The idea is that it’s to fight, terrorism and and crimes but I just think the technology is sort of an interesting piece.

00:16:55.000 –> 00:17:00.000
I think that’s why they want the photo IDs. And we’ll talk later. That’s why I think.

00:17:00.000 –> 00:17:11.000
It’s unlikely that condominiums. Are gonna get a late exemption in this game because I think the government’s more interested in building.

00:17:11.000 –> 00:17:22.000
A database. So. Who does the, federal, corporate transparency act, apply to?

00:17:22.000 –> 00:17:30.000
Well, it’s, it’s a corporation. And LLC or any other entity that is created.

00:17:30.000 –> 00:17:35.000
By the filing of a document with a Secretary of State. Or any similar office under the law of the state.

00:17:35.000 –> 00:17:56.000
So. In virtually every state, but Massachusetts. Condominium organizations. The organization of owners takes the form.

00:17:56.000 –> 00:18:08.000
Of a nonprofit. Corporation or nonprofit association. That has obligations to file with the Secretary of State.

00:18:08.000 –> 00:18:22.000
Massachusetts is a little bit of an outlier. For some reason, when somebody started creating condominiums in Massachusetts, They are formed under the term.

00:18:22.000 –> 00:18:28.000
Condominium trust. Okay. However, and so there’s no filing with the Secretary of State.

00:18:28.000 –> 00:18:38.000
But there’s a filing. At the registry of deeds and we believe that to be a similar office.

00:18:38.000 –> 00:18:49.000
Furthermore, while in Massachusetts, We call them condominium. Trusts, they’re not really.

00:18:49.000 –> 00:19:00.000
Trusts they’re not they’re not real estate trusts or business trusts all of the case law interpreting how they act and how they operate.

00:19:00.000 –> 00:19:14.000
They’ve been analogized. To corporations and and let’s think about it right the condominiums They have unit owners.

00:19:14.000 –> 00:19:29.000
Which in a lot of ways are analogous. To shareholders. They have elected boards of directors. Again, analogous to corporations.

00:19:29.000 –> 00:19:43.000
In Massachusetts. There’s a seminal case called Cody versus Levine. That analogizes the structure of condominiums to corporations and even applies.

00:19:43.000 –> 00:19:53.000
The, derivative requirements under mass rules, civil procedure, 23.1. To certain cases.

00:19:53.000 –> 00:20:06.000
Involving condominium associations. They’re not corporations in Massachusetts. But analogous and I think notwithstanding the fact that we call them trusts.

00:20:06.000 –> 00:20:20.000
I believe, and it’s, our legal opinion. That this act applies to condominium associations in Massachusetts.

00:20:20.000 –> 00:20:31.000
Just like they would in any other state. Now, even in Massachusetts, You have some. Some condominium associations.

00:20:31.000 –> 00:20:48.000
Take the corporate form, not every condominium association. In Massachusetts. Is a condominium trust and like I said the condominium trust concept is unheard of in any other state.

00:20:48.000 –> 00:21:04.000
The other states I practice. Most of the organizations. Our nonprofit. Corporations so again, The majority of my practices in Massachusetts.

00:21:04.000 –> 00:21:10.000
But as I indicated, I’m also licensed in. Rhode Island and New Hampshire.

00:21:10.000 –> 00:21:21.000
And my firm practices in main and florida as well. And like I said, I think the condominium trust thing is sort of an anomaly.

00:21:21.000 –> 00:21:31.000
And I can’t believe. That if we if we get down to it. That that Finson would say, oh yes, Massachusetts.

00:21:31.000 –> 00:21:49.000
Your condominium associations are exempt. Because they have a different form or formation. Then the condominiums in the other 49 states and and territories of the United States.

00:21:49.000 –> 00:21:59.000
So our legal opinion and And on top of that, you know, on something like this where we’re dealing with a requirement.

00:21:59.000 –> 00:22:08.000
With the federal government, I think it’s better to err on the side of caution. Make the filing.

00:22:08.000 –> 00:22:17.000
Rather than. Rather than possibly put yourself in a situation where you’re in violation of a federal law.

00:22:17.000 –> 00:22:35.000
So I’ve already seen some questions in the chat. About what entities. Are exempt. From filing under CTA what entities don’t have to report and then have their beneficial owners.

00:22:35.000 –> 00:22:44.000
File reports so So the majority of the exemptions and there’s 23 of them. Relate to entities.

00:22:44.000 –> 00:23:09.000
That have other reporting requirements. That identify Who the beneficial owners are. Who the key employees are. You know and and it for the most part It’s for the most part it’s other entities that are Hi, So for example, banks.

00:23:09.000 –> 00:23:19.000
Publicly traded entities. I’m gonna I’m gonna for fun. I’m gonna see how quickly I can go through all 23 exemptions.

00:23:19.000 –> 00:23:47.000
Exemption number one security reporting insurer a governmental authority a bank a credit union a depository institution holding company, a money services business, a broker or dealer insecurities, the securities exchange or clearing agency, other exchange act registered entity as in publicly traded corporation, investment company or investment advisor, venture capital fund advisor, insurance company.

00:23:47.000 –> 00:23:57.000
State licensed insurance producer, Commodity Exchange Act registered entity, an accounting firm. A public utility, a financial market.

00:23:57.000 –> 00:24:05.000
A 501 c 3 or 501 A entity, I’m going to get back to that in a second.

00:24:05.000 –> 00:24:16.000
An entity assisting a tax exempt entity. A large operating company, large operating company is a company that’s has 20 or more employees.

00:24:16.000 –> 00:24:33.000
And within the last. Tax reporting Here, filed a federal income tax. Return showing that it had more than 5 million dollars in gross receipts or sales.

00:24:33.000 –> 00:24:43.000
And then there’s other exemptions with respect to that one. And then a subsidiary of certain exempt entities.

00:24:43.000 –> 00:24:55.000
And then the last, the 20 third is. Inactive entity. So like an LLC or a corporation that’s been sitting out there, had to have been created before.

00:24:55.000 –> 00:25:04.000
2020 and is not engaged in any active business has not, sent or received any funds.

00:25:04.000 –> 00:25:08.000
In excess of a thousand dollars. Has not experienced any change in ownership in the preceding 12 month period.

00:25:08.000 –> 00:25:23.000
There’s a lot of requirements to the to the inactive entity. So one of the one of the questions I got, and some of the confusion.

00:25:23.000 –> 00:25:32.000
Is about what is a tax exempt entity. Nonprofits and people can fuse it all the time.

00:25:32.000 –> 00:25:46.000
Non-profits which Most condominium associations are. Are not tax exempt entities. Tax exempt entities are specific classified entities.

00:25:46.000 –> 00:25:59.000
Under. 501 c and 501 a of the internal revenue code. The the typical one, the one I’ve dealt with.

00:25:59.000 –> 00:26:27.000
More often than not is the so called 501 c 3 entity I remember for years I was treasurer of the North Attleboro Soccer Club back when my kids were soccer players and that was a 501 c 3 charity and and I think the reason for the exemption.

00:26:27.000 –> 00:26:34.000
On the 501 c 3 entities. Is because when, and I have some familiarity with.

00:26:34.000 –> 00:26:45.000
Dealing with their tax returns. Is you had to identify. As part of the filing. Who the key employees were, who the directors of the association were, what their addresses were.

00:26:45.000 –> 00:26:58.000
There was a lot more disclosure. On a 501 a or 501 see income tax return.

00:26:58.000 –> 00:27:12.000
So again, The issue is, and I really think the reason a lot of these entities are exempt other than the the 20 employee 5 million dollar company.

00:27:12.000 –> 00:27:32.000
Is because there is significant information That is reported about the about the beneficial owners. So Unfortunately, that does not exist.

00:27:32.000 –> 00:27:44.000
Most condominium associations. Whether they take the form of trust. Whether they take the form of a nonprofit corporation or unincorporated association.

00:27:44.000 –> 00:28:03.000
File tax returns. And the tax returns do not. Have the the same requirements of information. That a charitable organization has to put on their tax return.

00:28:03.000 –> 00:28:16.000
So, so, so let’s assume for the moment, that you are. Involved with a corporation, a condominium association.

00:28:16.000 –> 00:28:28.000
That has to report to Vincent. I’ve kind of already gone over this, but it doesn’t hurt to identify specifically what they’re looking for.

00:28:28.000 –> 00:28:37.000
So the first the first thing is the reporting company has to provide its legal name. And or its trade name.

00:28:37.000 –> 00:28:46.000
So You have some corporations. That have a legal name and then they do business as both should be reported.

00:28:46.000 –> 00:29:10.000
The address, the jurisdiction of formation or registration. Usually it’s gonna be the state in which the entity is operating but we know in the corporate world there’s a lot of benefits to filing corporations in certain states like, you know, I think the probably the most famous one is, Delaware.

00:29:10.000 –> 00:29:27.000
And then, and then the taxpayer identification number of. The entity. Then what the entity has to report on the database cloud website.

00:29:27.000 –> 00:29:38.000
Is the identity of the beneficial owners. And again, I’m gonna tell you how we figure out who’s a beneficial owner.

00:29:38.000 –> 00:29:49.000
That is the individual’s full legal name. Their birth date. Their residential address. And then.

00:29:49.000 –> 00:30:01.000
There will be a line item. For the ID number. Id number issued by a state.

00:30:01.000 –> 00:30:09.000
Or a foreign government. It is not. Your social security number. I’ve already spoken to a bunch of people.

00:30:09.000 –> 00:30:25.000
Who are strangely worried about reporting their social security number to the federal government. And sort of the irony of that is The federal government’s the one that issued you your social security number.

00:30:25.000 –> 00:30:34.000
But it’s not, it’s not your social. It’s the identification number that you’ve been issued.

00:30:34.000 –> 00:30:43.000
By your state, usually in connection with the issue of either a driver’s license. Or a state issued identification card.

00:30:43.000 –> 00:31:00.000
Then as I indicated on top of it You have to download. The card a picture of your license. that matches up with that number.

00:31:00.000 –> 00:31:11.000
So how do we know? Who is a beneficial owner? In in a reporting company. So with the reg say.

00:31:11.000 –> 00:31:27.000
Is it’s anybody. Who directly or indirectly exercises substantial control over the reporting company? Or owns or controls at least 25% of the ownership interests of the reporting company.

00:31:27.000 –> 00:31:42.000
The 25% is I think the Default, but when you look at the regs and and sort of the guidelines around the regs.

00:31:42.000 –> 00:31:52.000
They, they talk about control. So let’s talk first. In the condominium setting.

00:31:52.000 –> 00:32:03.000
It is rare. That you have any one person in a condominium. That has or holds 25% of the beneficial ownership.

00:32:03.000 –> 00:32:15.000
I say rare. It happens. I’ve seen it happen. Probably more often than not with an association that is not fully sold out or the developer might still.

00:32:15.000 –> 00:32:25.000
Be holding on or hanging on to 25% of the units. But even, in I’ve seen it in smaller associations.

00:32:25.000 –> 00:32:34.000
Or even some larger associations where somebody’s come in and bought up a block of of the condominium.

00:32:34.000 –> 00:32:40.000
But when it comes to condominium associations, the legal opinion that we’ve formed.

00:32:40.000 –> 00:32:47.000
Is who’s in control of that? It’s typically the board of directors, the board of trustees.

00:32:47.000 –> 00:32:58.000
The board of managers. They’re the ones that are in control, exercising, making responsible for the day-to-day operations.

00:32:58.000 –> 00:33:04.000
The day to day. The day-to-day decision-makings over the operation.

00:33:04.000 –> 00:33:13.000
Of the entity. The guidelines. Also talk about.

00:33:13.000 –> 00:33:23.000
If you go back to the corporate setting for a moment. That you know in a corporation if If nobody owns.

00:33:23.000 –> 00:33:30.000
25%. All right, well who’s? Who the management partners who are the Who’s on the board of directors?

00:33:30.000 –> 00:33:41.000
But they also talk about somebody that might not even own any shares. Or has a minimal. Position in the entity.

00:33:41.000 –> 00:33:50.000
That still is involved in day-to-day affairs. The, the examples they give are somebody that.

00:33:50.000 –> 00:34:07.000
And exercises substantial control over day to day affairs. The examples that they give. Are, people at ex officio board members Emeritus board members.

00:34:07.000 –> 00:34:20.000
Retiring shareholders that hold a prominent position. And one thing that I think is worth thinking about.

00:34:20.000 –> 00:34:32.000
In the condominium association world. Is sometimes you have documents. Where there is an X. Sometimes it’s reserved to the developer.

00:34:32.000 –> 00:34:45.000
Sometimes it’s reserved. To the past president or you know a chairman a meritis and emeritus position So I think as a general rule.

00:34:45.000 –> 00:34:54.000
The idea is going to be for Fins and filing purposes of BOI, if you’re a condominium association.

00:34:54.000 –> 00:35:04.000
It’s going to be the board of directors. But I think from time to time depending on the nature of your association.

00:35:04.000 –> 00:35:09.000
You might want to consult with your lawyer and say, oh, well, we have this, ex officio seat.

00:35:09.000 –> 00:35:17.000
Or the developer owns 27% of the units or we have this investor that owns 27% of the units.

00:35:17.000 –> 00:35:27.000
Should we have them? Also. File a with.

00:35:27.000 –> 00:35:31.000

00:35:31.000 –> 00:35:42.000
So, I’m seeing a lot of questions coming in. I’m probably going to reserve them to the end because I think a lot of them are going to get answered as as we go.

00:35:42.000 –> 00:35:52.000
So, so what is the timeline for all this? So, and how is this done? So, so the BOI reports.

00:35:52.000 –> 00:36:02.000
Filed electronically through Finland’s secure cloud based filing system. Called the Beneficial Ownership Secure System, boss.

00:36:02.000 –> 00:36:08.000
And they have a website. You know, I went on. And, I did.

00:36:08.000 –> 00:36:22.000
My fence in filing from my firm. On January second. So, the idea is if your company or your association was formed before January 1, 2024.

00:36:22.000 –> 00:36:32.000
You have until the end of this year to file. The BOI report. And again, the BOI report is in order for it to be complete.

00:36:32.000 –> 00:36:44.000
It is the information for the company, the company or the organization, including its taxpayer ID number, and then every one of the individuals.

00:36:44.000 –> 00:36:50.000
That is a beneficial owner. So if you’re a condominium association. And you have 5 board members.

00:36:50.000 –> 00:36:58.000
It’s complete when you file. The information on behalf of the entity. And then all 5 board members.

00:36:58.000 –> 00:37:08.000
File their information, including the data birth, upload their, driver’s license and their address and so forth.

00:37:08.000 –> 00:37:21.000
Reporting companies created or registered. On or after January 1, 2024. Initially had 30 days to file with Vincent.

00:37:21.000 –> 00:37:28.000
Because there’s been a little bit of a backlog or time gap. In in getting their system up and running.

00:37:28.000 –> 00:37:43.000
That 30 days has been expanded to 90 days. Importantly, after the initial report is filed.

00:37:43.000 –> 00:38:00.000
Before December of 2020 before January one of 2025 There are continuing. Obligations. Those.

00:38:00.000 –> 00:38:13.000
Continuing obligations are whenever and this is probably obvious. Whenever the entity changes. And beneficial ownership. So If a shareholder leaves.

00:38:13.000 –> 00:38:24.000
Somebody else gets over 25%. Importantly, I think for condominium associations or homeowner associations.

00:38:24.000 –> 00:38:34.000
We all know this they change Frequently, board members change. Frequently usually annually, right? Maybe, it’s all 5 of them.

00:38:34.000 –> 00:38:39.000
Maybe it’s one of them. Maybe it’s 2 of them. So whenever there’s a change.

00:38:39.000 –> 00:38:51.000
That needs to be updated. The updating timetable. Is 30 days from a change. The same if there’s a change of address.

00:38:51.000 –> 00:39:00.000
I don’t think that’s gonna be a big deal. When it comes to community associations because most of the board members tend to live at the property.

00:39:00.000 –> 00:39:10.000
But there are those where They’re operated. Or somebody’s on the board in their primary address.

00:39:10.000 –> 00:39:20.000
Is somewhere else, somewhere out of state. If the address, if the primary address changes. They’re required to update their.

00:39:20.000 –> 00:39:38.000
Beneficial ownership information with. And, one of the tricky ones is license updates so and again this kind of goes into the AI and the photographs of your face.

00:39:38.000 –> 00:39:47.000
Every time you get a new license. They want you to go back in and. Upload your drivers license.

00:39:47.000 –> 00:39:54.000
So that they have the updated photograph. Of your face. You know, and, to me that to me that’s kind of interesting.

00:39:54.000 –> 00:40:09.000
So The deadline, the initial deadline for all this is December 31, 2,024. I’m hoping people don’t wait.

00:40:09.000 –> 00:40:18.000
Until then to pull this together. Especially if you’re in a condominium association. Because you kinda have to herd the cat.

00:40:18.000 –> 00:40:26.000
You gotta get 5 or 7 or 9. Or 3 people together. To get licenses. And.

00:40:26.000 –> 00:40:40.000
And addresses and and taxpayer ID numbers. To get this filed and then And then we have to be on top of.

00:40:40.000 –> 00:40:50.000
The changes. Now, I know in in my practice. Whenever the board of directors of a condominium or HOA changes.

00:40:50.000 –> 00:41:07.000
We file something either with the Secretary of State or the Registry of Deeds. And to me, what we should be trained to do going forward is whenever we file that change or have our lawyers file that change.

00:41:07.000 –> 00:41:18.000
With the local entity, we should be making a similar change with and The federal entity.

00:41:18.000 –> 00:41:27.000
Now, Why do we want to do this? The, FINCENT is indicated in the law, the corporate transparency access.

00:41:27.000 –> 00:41:38.000
There is an enforcement mechanism. Violations of the reporting requirements include civil penalties of $500 per day for when you’re out of compliance.

00:41:38.000 –> 00:41:55.000
Not to exceed $10,000 and for potential imprisonment for up to 2 years. Can I tell you that the federal government’s going to be cracking down on Non-compliance.

00:41:55.000 –> 00:42:03.000
No, I can’t. Like I said, I think part of this exercise is for them to build a database.

00:42:03.000 –> 00:42:10.000
But I generally don’t like to mess around with the federal government. If the federal government wants you, they’ll get you.

00:42:10.000 –> 00:42:20.000
And I think you know, I always advise my clients to comply with the law. And it’s not that hard.

00:42:20.000 –> 00:42:28.000
To do and. You know, as a general, like to avoid penalties. For noncompliance.

00:42:28.000 –> 00:42:40.000
So. I wanna tell you about what. What we’ve done. So what we’ve done here at at all.

00:42:40.000 –> 00:42:48.000
And Marcus. Is, you know, we saw this coming. For several months now.

00:42:48.000 –> 00:42:59.000
And what I what I wanted to do is. Try to make it easy. For condominium associations and corporations.

00:42:59.000 –> 00:43:10.000
To avoid having to herd the cats, if you will. And And there’s also A.

00:43:10.000 –> 00:43:21.000
Concern by people in holding on to Private data, right? So. So if in a perfect world.

00:43:21.000 –> 00:43:29.000
If I had a great. Organization, condominium association. I’d say, alright, well,

00:43:29.000 –> 00:43:34.000
You know, I’m the president of the board and I’m gonna take care of this and I’m, I’m gonna get.

00:43:34.000 –> 00:43:47.000
The organization’s taxpayer ID number. I’m gonna go to Bob and Mary’s house and get photos of their IDs, then I’ll go to Jim’s house and Joe’s house and.

00:43:47.000 –> 00:43:55.000
And then I’m gonna, I’m gonna do all this filing. If I’m the management company I don’t want anything to do with this.

00:43:55.000 –> 00:44:03.000
I don’t want to touch it. I don’t want. People’s data being emailed to me.

00:44:03.000 –> 00:44:09.000
And when I say data, I’m talking about a driver’s license. I, I don’t, want it.

00:44:09.000 –> 00:44:19.000
And I don’t wanna be responsible. For it, given the penalties. And then given the concerns about.

00:44:19.000 –> 00:44:26.000
Data breaches. So what I’ve done here or I should say what we’ve done here.

00:44:26.000 –> 00:44:35.000
Is we’ve created. A program. And a portal. To allow this to be done.

00:44:35.000 –> 00:44:46.000
Easily and simply and over. You know and over time and allow.

00:44:46.000 –> 00:45:02.000
Our AI bots. To hound the people that need to be hounded. And we’ve also developed, with some technology, a, AI program.

00:45:02.000 –> 00:45:11.000
That allows us to alert people. When they need to, file particularly when they’re drivers licenses.

00:45:11.000 –> 00:45:24.000
Expire so So what we do. Is we will file. The required BOI with Vincent.

00:45:24.000 –> 00:45:35.000
For your organization. Keep you in compliance. Monitor changes going forward and heard the cats for you.

00:45:35.000 –> 00:45:49.000
And we do it in a way that does not. Put your licenses in danger. We’re not having them sent to us via email.

00:45:49.000 –> 00:45:56.000
We’ve. We’ve we’ve utilized our technology. Guy to create this portal.

00:45:56.000 –> 00:46:04.000
It’s on our website. At A. M. Condo law.

00:46:04.000 –> 00:46:12.000
Dot com under resources. You go under resources. You’ll see it. Under beneficial owner.

00:46:12.000 –> 00:46:25.000
Report and and it allows you to go on there and i’m gonna run a demonstration for you in a moment And, identify at each.

00:46:25.000 –> 00:46:44.000
Associations and board members. Or corporations leisure. Identify the name of the entity, the taxpayer ID number, and then each owner at their leisure or each Beneficial owner or board member.

00:46:44.000 –> 00:46:58.000
Inputs their own information. And and preferably the way it’ll work is. Either a board member or a.

00:46:58.000 –> 00:47:10.000
Manager emails us the names and the emails of the individuals that need to file the report so that our bot can follow up with them.

00:47:10.000 –> 00:47:18.000
And say okay we now have and we get a message we now have 3 in the portal We now have 4 in the portal.

00:47:18.000 –> 00:47:26.000
Oh, we have 5 in the portal. It’s ready to file. And then we once all the information is in that portal.

00:47:26.000 –> 00:47:38.000
We take it and we file it with. Our artificial intelligence spot. Pulls from the driver’s license.

00:47:38.000 –> 00:47:51.000
When your driver’s license expires. And, And then in the future sends an email. To that individual, assuming that they’re still on.

00:47:51.000 –> 00:48:00.000
The board assuming that they still have a beneficial ownership interest. And actually I think provides a really cool great service better than the service it’s provided by the registry of motor vehicles in Massachusetts.

00:48:00.000 –> 00:48:11.000
We tell you, hey, you know license is going to expire in 60 days. Please update your license.

00:48:11.000 –> 00:48:23.000
And when you’ve done so. Send us a photo so that we can update your information in with the federal government.

00:48:23.000 –> 00:48:39.000
And that’s kind of an important point. So when when there needs to be an update, let’s say Let’s say it’s, 2026 and and one person comes off the board.

00:48:39.000 –> 00:48:51.000
And one person goes on the board. We only need that additional one person’s information. Unless drivers license or addresses have changed.

00:48:51.000 –> 00:49:04.000
Which again, with the AI we’ve built into our. Portal we’re able to monitor for you So.

00:49:04.000 –> 00:49:11.000
The interesting thing I think is is we’re trying to make this easier. For condominium associations.

00:49:11.000 –> 00:49:24.000
We’re trying to provide a service. This is this is a what I consider to be an intrusive aggravating.

00:49:24.000 –> 00:49:31.000
Law. Enacted by the federal government. And.

00:49:31.000 –> 00:49:41.000
We’re trying to provide a service to make it as. Does. Less intrusive. And more convenient.

00:49:41.000 –> 00:49:50.000
For corporations, their directors and condominium associations, their board members, and particularly their managers.

00:49:50.000 –> 00:49:59.000
We’re trying, we’re trying to keep. Being a condominium or community association property manager is hard enough.

00:49:59.000 –> 00:50:22.000
You guys are dealing with. Leaks, roofs. Loans, a million other things, the last thing you want to be doing is collecting drivers license or chasing somebody down for their for their drivers license So we figure this is probably the easiest way to do it.

00:50:22.000 –> 00:50:33.000
And to monitor it. And we’ve invested in. In the infrastructure. Let me tell you, it’s not easy to create one of these.

00:50:33.000 –> 00:50:39.000
One of these portal things. Not even, I’m, really sure what it is.

00:50:39.000 –> 00:50:47.000
I’m just a lawyer. I’m not that technologically advanced. It was only a few years ago that I moved up from my blackberry to an iPhone.

00:50:47.000 –> 00:50:56.000
But, it’s kind of interesting, in dealing with the, technology guys as to how it was built.

00:50:56.000 –> 00:51:07.000
And, and then the firewalls. That have to go in because we want it to be secure because you’re transferring drivers licenses.

00:51:07.000 –> 00:51:28.000
To our portal so that we can comply and monitor that for you going forward. And let me tell you, it’s not cheap, to do this stuff and then like everything else, you build it and then all we got to add this we got to add that there’s a subscription for this as a subscription for that.

00:51:28.000 –> 00:51:37.000
But this is what we do. You know, we, myself, Jake Markus, Steve Marcus.

00:51:37.000 –> 00:51:49.000
We like to pride ourselves on on being condominium nerds. Providing education and providing service, which is why we’re also up there.

00:51:49.000 –> 00:51:57.000
Trying to help you folks with the Fannie Mae blacklist, which, which is another webinar.

00:51:57.000 –> 00:52:03.000
But so, what we’re doing and I’ll just tell you it’s It’s a one time.

00:52:03.000 –> 00:52:11.000
$500 fee. So it’s not expensive. To your association to do it. It’s really.

00:52:11.000 –> 00:52:22.000
Me. It’s not like I’m making a killing on this. It’s about trying to offset the costs.

00:52:22.000 –> 00:52:29.000
And provide the service. And, and what we do. Because, cause I know there’s been some discussion.

00:52:29.000 –> 00:52:38.000
About, well, when should we file? Should we wait until December 30 first to file? God, I hope not.

00:52:38.000 –> 00:52:47.000
I don’t wanna be. Like my accountant, I see my account and he’s kind of like a He’s a great jolly guy.

00:52:47.000 –> 00:52:53.000
He’s like 200 pounds. I see him in February, he’s happy. It’s fat.

00:52:53.000 –> 00:53:01.000
Then I see him on. Like May first he’s like lost 30 pounds because he spent all of April fourteenth and fifteenth.

00:53:01.000 –> 00:53:14.000
Filing those late filing last minute tax returns now to me the most, and I think I’ve already mentioned this, the most sensible time.

00:53:14.000 –> 00:53:32.000
For associations. To work with us to get this file through the portal is probably when. You’re filing your annual update either with the Secretary of State as to who the directors are or the, or the trustee certificate in Massachusetts.

00:53:32.000 –> 00:53:43.000
As to when you’re identifying who Your trustees are, but. You can do it now. And what our program is.

00:53:43.000 –> 00:53:55.000
Is, is, you know, for again, for that $500 fee. We will not charge anything else.

00:53:55.000 –> 00:54:08.000
For any updates made to your beneficial ownership filing. Within 12 months of your initial filing. So. So let’s say somebody files on.

00:54:08.000 –> 00:54:16.000
February second and then I don’t know. Let’s say somebody resigns. So, I get all the information today.

00:54:16.000 –> 00:54:23.000
We run around through the portal. We get you file with Vincent and then let’s say one of your board members resigns.

00:54:23.000 –> 00:54:32.000
On June thirtieth. And somebody gets appointed on. July first. Well, send us the information.

00:54:32.000 –> 00:54:47.000
And. We’ll upload it at no additional charge. Interestingly enough one of the associations that I have that’s already filed We, our bot notified them.

00:54:47.000 –> 00:54:55.000
That his driver’s license expires in 60 days. So he has to, and he, by the way, he was very thankful.

00:54:55.000 –> 00:55:02.000
He’s like, God, you better than the registry. thanks. Let me know my license expires because In Massachusetts, they don’t tell you when your license expires anymore.

00:55:02.000 –> 00:55:11.000
Remember back in the day, you used to get like a postcard or something? They don’t even tell you anymore.

00:55:11.000 –> 00:55:17.000
I got a funny story about that too, but I don’t know that I wanna get into it.

00:55:17.000 –> 00:55:21.000
Coming home out. Maybe I will get into it coming home from a Patriots game one night.

00:55:21.000 –> 00:55:32.000
I got into a minor fender vendor and it was Tom Brady’s last game. And, the police came.

00:55:32.000 –> 00:55:39.000
And, the option is like, okay, exchange your information, so forth and so on. And it was a night game.

00:55:39.000 –> 00:55:43.000
And he looks at me and he says, and I see a license, looks at my license, he goes, he goes, you can’t drive.

00:55:43.000 –> 00:55:49.000
I said, what do you mean? He goes, sir, it, it happened to be my birthday.

00:55:49.000 –> 00:55:55.000
It was January fourth, 2020. He goes, sir, your license expired 5 min ago.

00:55:55.000 –> 00:56:03.000
I’m like, really? Come on. He goes, he goes, you can try to go online right now and and get a new license.

00:56:03.000 –> 00:56:10.000
I’m like, now he goes, so he goes, someone else is gonna have to drive and he looks at my brother who’s sitting in the passenger seat.

00:56:10.000 –> 00:56:21.000
And he’s like, not him. So, the interesting thing is, we’ve already had somebody, their license has expired.

00:56:21.000 –> 00:56:27.000
We’ve notified them of that. Through our AI. He’s getting an updated.

00:56:27.000 –> 00:56:35.000
Once he gets it updated, he’s gonna download it through our portal. We’ll get a notifications in our portal and then we’ll upload it to Vincent.

00:56:35.000 –> 00:56:44.000
So that’s what we’ve invested in. I think, the idea is to make it easier.

00:56:44.000 –> 00:56:54.000
For, every association. To get this done without the hassle, the headache. Will heard the cats.

00:56:54.000 –> 00:56:58.000
And like I said, most importantly, your data. Is gonna be secure. That’s why we’ve created the portal.

00:56:58.000 –> 00:57:08.000
That’s why we’ve created the firewalls. That’s why we have the cybersecurity.

00:57:08.000 –> 00:57:21.000
Rider. To our insurance policy. It’s to keep you at peace of mind to assist you with what I consider to be this annoying and overburdening.

00:57:21.000 –> 00:57:30.000
Law. Now, There is a little bit of a buzz. About.

00:57:30.000 –> 00:57:42.000
A possible exemption coming for condominiums. I know that. Cai National is is working feverishly to do that.

00:57:42.000 –> 00:57:50.000
Like I said, I This law was passed in 2021. So I think the time for exemptions.

00:57:50.000 –> 00:58:01.000
Has come and gone I can’t imagine. Congress is going to create an exemption after the reporting period has begun.

00:58:01.000 –> 00:58:07.000
I think I know they’re working on it. I’m hopeful. You know, it’d be great if I know there’s some people on this call that are working on it.

00:58:07.000 –> 00:58:18.000
I know Steve Marcus is on the federal lack. He’s working on it. The the thing we can all hope.

00:58:18.000 –> 00:58:25.000
For an exemption in the future. The problem is the law is in effect now. I’m encouraging people.

00:58:25.000 –> 00:58:39.000
When the law is is in play to comply with the law. Could there be an exemption on no in November or July or September or October?

00:58:39.000 –> 00:58:50.000
Sure. I don’t anticipate it and the reason I don’t anticipate is as I stated throughout is I think the federal government is interested in creating a database.

00:58:50.000 –> 00:58:59.000
The more, the more information, the bigger that database. The more photos, the more faces.

00:58:59.000 –> 00:59:08.000
The bigger that facial recognition. Database. I don’t think it’s coming. However, If it does come.

00:59:08.000 –> 00:59:23.000
What and and you’ve used our office to make this filing. Through our portal and you’ve spent the $500 I’ll give you a credit.

00:59:23.000 –> 00:59:34.000
For the $500 towards something else. Like I said, this isn’t about making money This is about providing.

00:59:34.000 –> 00:59:45.000
What i think is an important service. Taking putting your mind at ease. For a condominium associations to comply.

00:59:45.000 –> 00:59:59.000
With this annoying law. Like I said, I think that probably the best time for you guys to do this is when the certificates are being filed at the registry or the secretary of state.

00:59:59.000 –> 01:00:12.000
I’d hope you don’t wait for the December 2024 rush so I don’t have all of my staff here on New Year’s Eve trying to get these filings.

01:00:12.000 –> 01:00:24.000
Done. And I don’t although I don’t know maybe there’s some benefit to that like my account maybe I can lose I can lose 20 pounds.

01:00:24.000 –> 01:00:29.000
That’s the last minute doing that. So that’s, that’s it, folks.

01:00:29.000 –> 01:00:39.000
That’s the presentation. I’ve seen a lot of people. On here asking for the recording or the slideshow.

01:00:39.000 –> 01:00:47.000
I’m gonna get that. To, people. Gonna try to go through some of the questions.

01:00:47.000 –> 01:00:57.000
You know, I think I think I’ve. Answered most of them what I’m seeing.

01:00:57.000 –> 01:01:16.000
So I saw one. Where somebody said, you know, Since 2018 Llc’s of open business accounts have had to submit a BOI form with personal information to their bank.

01:01:16.000 –> 01:01:24.000
Do they have to submit to Finland if they’ve already reported? Similar information to their bank and the answer is yes, they do.

01:01:24.000 –> 01:01:33.000
The fact that you’ve reported or given your license to to your bank or your personal information to your bank.

01:01:33.000 –> 01:01:45.000
Does not exempt you from having to provide this information to the federal government. Someone asked me if management companies.

01:01:45.000 –> 01:01:56.000
Should be providing the reporting service. I’m gonna probably say no to that. And the reason I’m gonna say no and I know that there’s.

01:01:56.000 –> 01:02:10.000
A accountant on this call who has spoken to me. about, I know his accounting company.

01:02:10.000 –> 01:02:23.000
Doesn’t want to get involved in it. For the reasons of quite frankly, it’s In some respects, it can be deemed to be legal advice.

01:02:23.000 –> 01:02:31.000
You know, there are gonna be situations where a legal. Opinion needs to be made as to who the beneficial owners are.

01:02:31.000 –> 01:02:44.000
And then. The other question is is you know whoever is doing the reporting for you. Do you want them holding the information?

01:02:44.000 –> 01:02:56.000
How do you get the information to them? Are you, you know, is there any concern about, privacy and or data breach.

01:02:56.000 –> 01:03:05.000
Someone here said. You know, small associations of 3. Everyone has more than 25%.

01:03:05.000 –> 01:03:13.000
I agree with that. Usually in those associations, we have a lot of those in Boston, those 3 units.

01:03:13.000 –> 01:03:29.000
Or 4 unit condominiums, lot of them in South Boston. Usually in those cases everybody’s got 25% and and in those cases on top of the 25% Everybody has a seat on the board.

01:03:29.000 –> 01:03:37.000
So you might qualify in 2 ways. You’re in control as you’re a board member and you have more than 25.

01:03:37.000 –> 01:03:50.000
Percent. I, someone asked the question. That I’ve seen some legal opinions that say an association.

01:03:50.000 –> 01:04:01.000
That elects to file form 1120 H. Is effectively a nonprofit and thus exempt from this. The answer to that question.

01:04:01.000 –> 01:04:14.000
And, and, some of the folks and myself on this call. Have been. Engaged in communication with some accountants across the country on this very issue.

01:04:14.000 –> 01:04:30.000
The regulations. Say 501 c 3 or 501 a You are a nonprofit corporation. Not all nonprofit corporations.

01:04:30.000 –> 01:04:43.000
Our 501 C or 501 A. Those are usual, usually. Charities. There are very few.

01:04:43.000 –> 01:04:53.000
Although there are some. There are very few A. And condominium associations that are 501 a or 501 CI would say less than less than 1%.

01:04:53.000 –> 01:05:02.000
Nationwide. It’s a very small number. So the answer to your question is.

01:05:02.000 –> 01:05:17.000
The regulations Give an exemption. They do not give an exemption for nonprofits. They give an exemption for 500, and ONE, C, and 500, and ONE, A, if you’re not a 501 C and a 501 A, you are required.

01:05:17.000 –> 01:05:28.000
Do report. So one of the questions is. Who on the board submits their photo ID. The answer to that is all.

01:05:28.000 –> 01:05:38.000
All board members. And that’s part of the you know, that’s part of the reason why I think the portal is a good idea.

01:05:38.000 –> 01:05:48.000
All board members. Have to submit. And by the way, why don’t, why don’t I see if I can take you through.

01:05:48.000 –> 01:05:53.000
Our portal. I just wanna show it to you. So this is where it is.

01:05:53.000 –> 01:06:01.000
It’s AM condo law.com beneficial ownership information report. And so you’ll come here.

01:06:01.000 –> 01:06:13.000
And. Each board member identifies the name of their condo trust or corporation. Any DVAs.

01:06:13.000 –> 01:06:22.000
The address, jurisdiction. Taxpayer ID number. Now, the next thing on our dropdown.

01:06:22.000 –> 01:06:32.000
Is what I expect ordinarily is going to be each director, each trustees gonna fill out. This on my portal or our portal.

01:06:32.000 –> 01:06:48.000
By themselves. So if you follow up by yourselves then you keep this number up here one. Now, I do envision scenarios, right, where you might have a board member or trustee.

01:06:48.000 –> 01:06:55.000
Who’s not terribly. Technology proficient, right? Maybe doesn’t even have a computer.

01:06:55.000 –> 01:07:00.000
And so maybe Mary says, all right, well, Bob, I’ll take care of yours for you.

01:07:00.000 –> 01:07:09.000
Just give me, just give me a picture of your license, right? So, okay, so you get a picture of of Mary gets a picture of Bob’s license.

01:07:09.000 –> 01:07:15.000
And then she comes to our portal. And then she clicks the drag down to. So then she fills out.

01:07:15.000 –> 01:07:29.000
Her information right here. drags the photo into into this. Spot and then she fills in Bob’s.

01:07:29.000 –> 01:07:39.000
And then she hit submit. Now maybe, maybe there’s some industrious director or trustee who says, you know what?

01:07:39.000 –> 01:07:47.000
I really want this done. I’m gonna go get all 5 of my board members licenses. And, and I’m gonna fill this out for everybody because I want this done.

01:07:47.000 –> 01:07:54.000
I’m gonna get this over to Alcock so we can get it filed. Oh, he goes to the to the little thing here.

01:07:54.000 –> 01:08:01.000
He clicks out 5. And then he’s gonna fill out. 5 of these things. And then he hit submit.

01:08:01.000 –> 01:08:10.000
And we go and we go there. So let me continue to. Answer some questions. What does BOI stand for?

01:08:10.000 –> 01:08:18.000
Sorry, I use an acronyms. So the 2 an acronyms with corporate transparency act are CTA.

01:08:18.000 –> 01:08:29.000
Corporate transparency act BOI is beneficial ownership information. So somebody asked us one individual report for all.

01:08:29.000 –> 01:08:40.000
Or just each member need to register individually. I think I’ve answered that question. It’s not complete until all beneficial owners have filed.

01:08:40.000 –> 01:08:50.000
So if one board member wants to herd the cats. Or you want. Us to herd the cats.

01:08:50.000 –> 01:08:59.000
You can do it either way, like I said, with the number one. Drop down or the number 5 dropdown up here.

01:08:59.000 –> 01:09:09.000
And like I said, the portal notifies us. When anybody files. And if we need and, you know, we have the ability.

01:09:09.000 –> 01:09:19.000
Through our portal and the AI to chase down the stragglers. And then make sure that we’ve collected all 5 the necessary information.

01:09:19.000 –> 01:09:27.000
And, and do it for you, but. But you can have one trusty do that.

01:09:27.000 –> 01:09:39.000
Yourself. I did see somebody say I highly doubt condo associations are hot. But of terrorist cell fundings.

01:09:39.000 –> 01:09:52.000
This is a huge overreach by the feds. I don’t disagree with that. But you know, I think part of this is the feds, you know, we the condominiums and H ways didn’t get an exemption.

01:09:52.000 –> 01:10:08.000
Part of it is about them creating the database. However, however, there have been scenarios. Where there have been significant financial crimes at condominium associations.

01:10:08.000 –> 01:10:32.000
And I do think the federal government is aware. Of certain you know, and I think Florida is a hot benefit right now where, condominiums are being torn down and being bought with foreign investor money whether it’s Saudi or Chinese.

01:10:32.000 –> 01:10:42.000
So those will be scenarios when new towers are going up. The board is going to be controlled by the developer.

01:10:42.000 –> 01:10:49.000
And let’s be honest, some condominium associations whether it’s in Massachusetts or Ireland.

01:10:49.000 –> 01:11:00.000
Florida. We got a lot of new towers in Boston. There are millions of dollars running through, some of these associations.

01:11:00.000 –> 01:11:02.000
And it’s not just terrorism, it’s It could be money laundering or significant financial crimes.

01:11:02.000 –> 01:11:16.000
One of which could be embezzlement, right? Pyramid schemes. Things like that do occasionally happen.

01:11:16.000 –> 01:11:24.000
Do occasionally happen it’s not It’s not every day. But they do occasionally happen.

01:11:24.000 –> 01:11:31.000
So someone asked what happens if a board member or refuses to cooperate with the providing of the information.

01:11:31.000 –> 01:11:40.000
Well. I think. If they fail to do that. You know, maybe we can.

01:11:40.000 –> 01:11:56.000
Try to convince them. That this is not that big a deal. You know, I know some of the initial concerns I got back or feedback from people as I mentioned already was Social Security numbers.

01:11:56.000 –> 01:12:00.000
Like I said, I mean, who cares? I mean, the government already has your social security number.

01:12:00.000 –> 01:12:06.000
People are objecting to. Sometimes people just get stuff in their head. Or they’re obstinate.

01:12:06.000 –> 01:12:19.000
They already have your social security number. and Hopefully, you know, and I’d be happy to help assuage them that this is not that big a deal.

01:12:19.000 –> 01:12:24.000
Hell, you go to the You go, if you fly, you go to Logan Airport.

01:12:24.000 –> 01:12:31.000
You’re giving them your drivers license and they’re taking a picture of you for God’s sake to match it up.

01:12:31.000 –> 01:12:37.000
So it’s not that big a deal, but. If you’re a board member is really, really, really that obstinate.

01:12:37.000 –> 01:12:56.000
I mean, my recommendation probably is gonna be to explore. You know, having them replaced because you know, I think it’s more important for your, organization to be compliant with federal law.

01:12:56.000 –> 01:13:02.000
Then not.

01:13:02.000 –> 01:13:10.000
So I got somebody that says, so a condominium association that is not registered with the state as a legal entity would be exempt from this.

01:13:10.000 –> 01:13:17.000
I know of no condominium association that is not registered with the state in some form or fashion.

01:13:17.000 –> 01:13:22.000
Whether it’s the Secretary of State’s office. Or the, registry of deeds.

01:13:22.000 –> 01:13:33.000
I do not know of any association. That has not been created through the filing of a document.

01:13:33.000 –> 01:13:39.000
At the registry of deeds. Maybe there’s one out there. I know of none.

01:13:39.000 –> 01:14:00.000
Someone asked me if we do this outside of our geographical area. That’s something that I’d ask you to as far as geographical area I practice or my firm practices and 5 states.

01:14:00.000 –> 01:14:09.000
If there was someone asking if we could do this in. In you know 4 clients. Outside of our jurisdictions.

01:14:09.000 –> 01:14:19.000
I don’t, I think the answer to that would be no, I would. I would view this as providing legal advice.

01:14:19.000 –> 01:14:30.000
Within that state, I can’t practice law in a state. So, could I collect this information and file it for condominium in Colorado.

01:14:30.000 –> 01:14:37.000
The answer would be no, but I could probably point you in the direction of somebody in Colorado or California.

01:14:37.000 –> 01:14:42.000
Or Georgia.

01:14:42.000 –> 01:14:49.000
Somebody said it’d be great if there’s a one page you to provide to the board. To explain what is need and what we’ll do.

01:14:49.000 –> 01:14:57.000
I will do my best to get to that Elizabeth. So much said what happened when board members change.

01:14:57.000 –> 01:15:07.000
I think I’ve already explained this the the incoming board member needs to provide their information. I think it’s perfect.

01:15:07.000 –> 01:15:19.000
Perfectly done when the new certificate, is, filing someone said, are the HIs included in the reporting?

01:15:19.000 –> 01:15:26.000
Yeah, yes, the very first part of the reporting. Is. The name of the association of the entity, their address, their jurisdiction of formation.

01:15:26.000 –> 01:15:41.000
Remember we talked about, are you formed in Delaware, Massachusetts. And the entities. taxpayer ID number.

01:15:41.000 –> 01:15:48.000
If someone asked me, does the board have to give you permission to go ahead with this? Are you working with the management companies?

01:15:48.000 –> 01:15:57.000
I’m working with both I’ve had a couple of management companies. Actually already approached me.

01:15:57.000 –> 01:16:02.000
And say, look, we’re just gonna tell our folks. To give. Tell our managers to work with you directly.

01:16:02.000 –> 01:16:10.000
They’re gonna send you an email with the trustee certificate when they do this. And then, you’re gonna send them a link to the portal.

01:16:10.000 –> 01:16:22.000
And it’s gonna, you know, so could be either way, either the board. Can work with us directly or through the management company.

01:16:22.000 –> 01:16:35.000
It’s up to it’s up to you folks. Let’s see what else do we have, more about the

01:16:35.000 –> 01:16:41.000
So, oh, someone asked me, will my program work for non condominium entities? The answer is yes.

01:16:41.000 –> 01:16:48.000
Is there a file and fee outside of our program by the government? The answer is no, just a penalty.

01:16:48.000 –> 01:17:02.000
If you don’t do it and yes, our program does work. For non condominium entities you’ll see at the top here it’s Condominium Association Trust or corporation.

01:17:02.000 –> 01:17:11.000
And actually it’s kind of interesting. For certain, I have one client who has.

01:17:11.000 –> 01:17:21.000
82 . Yeah, in various. Forms of life. He’s a developer.

01:17:21.000 –> 01:17:32.000
And for an entity, for someone like that who has many entities. There’s, there’s a way to relieve the administrative burden of filling out.

01:17:32.000 –> 01:17:43.000
82 forms and resubmitting the drivers license, 82 times. It’s called the Finsin identification number.

01:17:43.000 –> 01:17:50.000
I think that’s going to be rare. But for those people who are interested in dealing with corporate entities.

01:17:50.000 –> 01:17:56.000
And if you have a lot of them like that one client I have happy to discuss that with you.

01:17:56.000 –> 01:18:13.000
Yeah, so John, someone asked me, are you offering the service to non OHA business entities the answer is yes Someone asked can we clarify what is we need to do exactly within the next 90 days.

01:18:13.000 –> 01:18:23.000
And what we have until December 31 file okay so confusion there So if your entity is created in 2024.

01:18:23.000 –> 01:18:37.000
Okay, 2024. You have 90 days. To fill out the information. That appears here on my website, which is the name of the entity, the address, jurisdiction.

01:18:37.000 –> 01:18:46.000
Tax payer ID number. Then identify. We are beneficial owners are. With their drivers license.

01:18:46.000 –> 01:18:57.000
And and the photographs. So, if you, created an entity on January second. Of 2024.

01:18:57.000 –> 01:19:09.000
You have to do this by April second. If your entity, or condominium existed. Before, 2,024, you have until the end of the year.

01:19:09.000 –> 01:19:26.000
To do this. Once, once you file. Let’s say I file. And I filed for my company on january second I wanted to be one of the first.

01:19:26.000 –> 01:19:38.000
If there is a change in the beneficial ownership interest. If If I say I’ve had enough of practicing lawn, I’m gonna go play golf in Florida.

01:19:38.000 –> 01:19:47.000
And leave this whole thing to Jake. We have 30 days. From that change of when I leave.

01:19:47.000 –> 01:20:00.000
To update the system with . The one of the benefits of using our portal with the built in AI.

01:20:00.000 –> 01:20:11.000
Is is that we’re gonna monitor that for you. Again, the drivers licenses. When we get the trustee certificates.

01:20:11.000 –> 01:20:20.000
And the and the filings with the Secretary of State. We’re gonna see when board members terms expire.

01:20:20.000 –> 01:20:32.000
And we’re gonna try to use our, bots to stay ahead of that for you.

01:20:32.000 –> 01:20:41.000
So, somebody asked me talking about board members. Or developers or owners with more than 25%.

01:20:41.000 –> 01:20:53.000
The answer is yes. So one question was. Do we need to report for board members if someone owns 25% or more?

01:20:53.000 –> 01:21:08.000
The answer is yes. You report for the board members. And the individual that owns more than 25%.

01:21:08.000 –> 01:21:26.000
Oh, actually very interesting from. Ken Bloom, my accounting friend. Who says that condominiums that file 1120 H operate without a profit mode of but are not profits.

01:21:26.000 –> 01:21:40.000
But are not, not nonprofits. As defined in federal tax law. so it to me, that’s kind of interesting and even more of a reason.

01:21:40.000 –> 01:21:51.000
Why associations. Should be filing. Someone just said that they can’t see the portal.

01:21:51.000 –> 01:21:58.000
That’s unfortunate. I thought. That the.

01:21:58.000 –> 01:22:07.000
That the portal was viewable. I can see it on. My screen. Well, anyway, go.

01:22:07.000 –> 01:22:17.000
Go to, AM condo law, under resources beneficial ownership information report. And you’ll be able to see the portal.

01:22:17.000 –> 01:22:25.000
It’s very easy to use. It’s very simple. Someone asked me would this Also apply to owners of apartment buildings.

01:22:25.000 –> 01:22:38.000
The answer is yes. If the apartment building is held in a LLC or they corporation.

01:22:38.000 –> 01:22:47.000
I apologize that people could not see the portal. That’s unfortunate. I don’t know why that did not work.

01:22:47.000 –> 01:22:56.000
Let me see if I can actually. You see, if I can actually do that, if I can try to.

01:22:56.000 –> 01:23:04.000
I don’t really know how to figure that out. Apologies. Go to AM Condo Law, you will see.

01:23:04.000 –> 01:23:09.000
You will see the portal.

01:23:09.000 –> 01:23:16.000
I have it up on my screen now. Can anybody see that? You know what? You know what I will also do, folks.

01:23:16.000 –> 01:23:24.000
Yeah, somebody asked me. Finn Sin is the entity. This is filed with the answer is yes.

01:23:24.000 –> 01:23:35.000
What I will do. Is when I send out the PowerPoint to anybody that wants it, I will include.

01:23:35.000 –> 01:23:47.000
A screenshot of. Our portal. someone asked me if the portal is mobile friendly.

01:23:47.000 –> 01:23:55.000
I believe it is. and yes, photos can be uploaded from the cell phones.

01:23:55.000 –> 01:24:04.000
Yeah, and, that’s how I did it. I just took a picture of my own, license with my Cell phone.

01:24:04.000 –> 01:24:16.000
Will cooperatives be impacted as well? I think. The answer to that is yes.

01:24:16.000 –> 01:24:28.000
Most cooperatives I’ve dealt with. Take the form of a corporation.

01:24:28.000 –> 01:24:41.000
Someone asked me for unit condominium. 2 units not registers trustees. But they each have a 25% interest.

01:24:41.000 –> 01:24:55.000
I think the answer is, to be safe. I would have all 4 file. Someone asked me, someone said, Property managers handle huge amounts of money.

01:24:55.000 –> 01:25:02.000
And And like me, property management companies. They have to do their own filing.

01:25:02.000 –> 01:25:12.000
Unless they meet one of the One of the exemptions. Some of them might, some of them might have more than 20 employees.

01:25:12.000 –> 01:25:19.000
And. More than 5 million dollars and Gross.

01:25:19.000 –> 01:25:24.000
Receipts from the prior year based on on a file tax return. I mean, I know we have some very big property management companies, national companies.

01:25:24.000 –> 01:25:36.000
Some of them may fall within. The exemption.

01:25:36.000 –> 01:25:45.000
Someone said, even though IRC code 5 28 makes homeowner associations tax exempt.

01:25:45.000 –> 01:25:53.000
Is it your opinion that since they are not specifically 501 c are they still subject to this the answer to that is yes.

01:25:53.000 –> 01:26:06.000
The The exemption under. Under the. Regulations is for 501 see or 501 a entities.

01:26:06.000 –> 01:26:23.000
It is not. It is not for entities that are classified as nonprofit or entities that the tax code defines as an entity that is exempt from taxation.

01:26:23.000 –> 01:26:33.000
I as a lawyer and and and again this is why this is. A legal question as a lawyer, I look at the law and it says these entities are exempt.

01:26:33.000 –> 01:26:42.000
It does not say tax exempt entities are exempt. It says entities. That are exempt under 501 a or 501 c.

01:26:42.000 –> 01:26:51.000
Can someone ask me can a small condominium file directly with Vincent? Sure. I, they can.

01:26:51.000 –> 01:27:05.000
However, that small entity needs to make sure it’s done correctly. And that there is a monitoring and follow-up program anytime.

01:27:05.000 –> 01:27:18.000
There are changes. That require amendments to be filed within 30 days.

01:27:18.000 –> 01:27:27.000
Someone said, can you send out the information on the portal to the participants on what the advantages of using the portals.

01:27:27.000 –> 01:27:34.000
I think I’ve kinda gone over it, and I will. Yeah, maybe I’ll try to include that in.

01:27:34.000 –> 01:27:44.000
In the one pager. someone asked me would we. Be willing to file if you are not a client.

01:27:44.000 –> 01:27:57.000
The answer is yes. By filing then. You would become a client, we can represent a client for a limited purpose.

01:27:57.000 –> 01:28:07.000
We don’t need to represent you for everything. And who knows, maybe. Maybe you’ll find that we’re actually good at this and good at other things.

01:28:07.000 –> 01:28:15.000
Like I said, We’ve put this together. We really we really pride ourselves on education.

01:28:15.000 –> 01:28:27.000
And trying to stay ahead of the curve. And making life easier for. Community associations. So, we’d love to, help you with this.

01:28:27.000 –> 01:28:38.000
Someone asked about the Finsen identification number. It is on their website, Google it.

01:28:38.000 –> 01:28:47.000
So, one just said that did work close the side slide show. So I guess. Maybe it did work.

01:28:47.000 –> 01:28:53.000
So I guess I had to switch windows.

01:28:53.000 –> 01:29:01.000
We’ll send the PowerPoint. I appreciate everybody spending an hour and a half with me on a Friday.

01:29:01.000 –> 01:29:12.000
Morning and listening. If there’s anything I can do to help. So send me an email, at am condo law.

01:29:12.000 –> 01:29:22.000
Dot com. And otherwise, please go to our website@amcondolaw.com go to resources.

01:29:22.000 –> 01:29:31.000
And and, drag down to beneficial ownership information. And you will see what is currently on your screen.

01:29:31.000 –> 01:29:53.000
Thank you very much everybody. I really appreciate you spending. Roundhog Day with me.


Share this article
Share this article