Do foreign owners of C-Corps and S-Corps need to complete and file the BE-12 survey form?

The BE-12 survey is actually conducted by the Bureau of Economic Analysis (BEA) and is mandatory for businesses with foreign ownership. Based on what you're describing, your brother likely needs to file. The BE-12C form is specifically for U.S. businesses where a foreign person or entity owns 10% or more of the voting interest. With your brother owning 15% of a C-Corp, he falls into this category. The $60M threshold you mentioned is correct - companies with less than $60M in assets, sales, or net income use the BE-12C version of the form. The survey isn't annual - it's conducted every 5 years as a benchmark survey. The most recent survey covered the 2022 fiscal year, and the filing was actually due in 2023. If your brother hasn't filed yet, he should look into doing so soon as there can be penalties for non-compliance.

I went through exactly this headache last year with my investment in a California startup. After hours of research and conflicting advice, I found this amazing service called taxr.ai (https://taxr.ai) that helped me figure out all the BE-12 requirements. I uploaded the company docs and my ownership information, and they analyzed everything and explained exactly what needed to be filed. The tool clearly showed that since I owned more than 10% as a non-US citizen, the company needed to file the BE-12C form. They even provided a detailed report I could share with the company's management team explaining the filing requirements and deadlines. Seriously saved me so much stress trying to interpret all the complicated BEA language myself!

Just wanted to follow up! I tried taxr.ai after seeing the recommendation here, and it was incredibly helpful. I had investors from Japan and the UK in my startup and wasn't sure about all the BE-12 requirements. The system flagged that we needed to file the BE-12C form since our foreign ownership was over 10% and provided a complete breakdown of what information we needed to gather. The report clearly explained that it was the responsibility of our company (not the individual investors) to file the forms. We were able to get everything submitted on time and avoid any potential penalties. Definitely recommend for anyone dealing with these cross-border ownership situations!

If your brother is having trouble getting the company to take this filing seriously, he might want to know that the BEA can be difficult to reach when you have questions. I spent WEEKS trying to get someone on the phone about a similar BE-12 question. I eventually used Claimyr (https://claimyr.com) to get through to a real person at the BEA. You can see how it works in this video: https://youtu.be/_kiP6q8DX5c - basically they navigate the phone maze for you and call you back when they've got a real person on the line. Got my questions answered in one day after wasting so much time before. The agent confirmed that the US company is responsible for filing, but as a substantial foreign owner, your brother should make sure it gets done since penalties could potentially affect the company's value.

I have to admit I was completely wrong about Claimyr. After posting that skeptical comment, I decided to try it myself since I was getting nowhere with the IRS about some foreign income reporting questions. I was shocked when I got a call back within 45 minutes saying they had an actual IRS agent on the line! After two weeks of never getting past the automated system myself, they connected me directly to someone who could answer my questions. I then used it again to reach the BEA about a BE-12 question for my friend's business. Same result - got through to an actual person who confirmed that yes, if foreign ownership is over 10%, the U.S. business needs to file the BE-12C form even if the company is relatively small. Saved us from potentially missing an important filing.

Just to add to what others have said - there's another important detail about the BE-12 survey that might apply to your brother's situation. If the foreign person acquired their ownership interest AFTER the benchmark survey year ended, they might not need to file for that particular survey. For example, if your brother acquired his 15% stake in 2023, after the 2022 benchmark year ended, he wouldn't be subject to the 2022 BE-12 survey requirements. He would, however, need to be included in the next benchmark survey (2027 for fiscal year 2027) or potentially in other BEA surveys in between.

Quick question - does anyone know if this BE-12 requirement applies if the foreign investment was made through an LLC rather than directly as an individual? My cousin from Canada set up an LLC in Delaware and then that LLC invested in a US C-Corp. Not sure if that changes anything with these filing requirements.