The US Bureau of Economic Analysis (BEA) is an agency of the US Department of Commerce which monitors inbound and outbound investments of the United States as part of its regulatory mission of tracking international commerce.

To help fulfill this mission, the BEA conducts a benchmark survey every five years with 2020 falling as a reporting year. This report is not the same as the Internal Revenue Service (IRS)’s and imposes mandatory reporting obligations of:

    • U.S. individuals and businesses holding a direct or indirect 10% or greater interest in a foreign business venture.
    • U.S. business ventures that directly or indirectly hold 10% or more foreign ownership.

The BEA’s report does not include taxable income. However, it does require more detailed company information and can also request supplemental quarterly and/or annual reports.

On top of this benchmark survey, an additional survey of new foreign direct investments in the United States must be filed within 45 days of any transaction if there is foreign ownership of 10% or greater and the investment is greater than $3 million. However, if the investment is less than $3 million with at least 10% ownership, a claim from exemption form must be filed to avoid a longer form.

Failure to comply can result in both civil and criminal penalties, with civil fees ranging from $2,500 to $25,000 USD. The BEA has historically assured compliance from companies through encouragement and direct contact. Now, they plan to impose penalties if the encouragement does not work.

To fulfill a business’s obligation, most business owners utilized their law firm or a specialty compliance firm. If you need assistance with BEA compliance, contact the international tax advisors at Doeren Mayhew today.