BOI and Unauthorized Practice of Law: The Case in Washington State

by Mike Nelson

Updated February 16 to include coverage and risk management details shared by insurance companies.

Beneficial Ownership Information (BOI) requirements went into effect on January 1, 2024. (If you’re not familiar with these requirements, there are some resources below with more information.) While the WSCPA and others advocated for a delay to these requirements, the dysfunction in Congress meant the delay couldn’t pass the finish line before the new year and has now been slowed by the work to avoid a government shutdown.

While there are many resources from national groups like the AICPA and others on the specifics of the BOI, one thing they all say is look to your individual state for guidance on whether a CPA is eligible to fill out the BOI forms for clients, as this is determined on a state-by-state basis.

What is the guidance in our state? The short answer is that Washington has issued no guidance on whether CPAs can fill out these forms.

Unlike some states that have given authority to the question of what is an unauthorized practice of law (UPL) to the state bar or others, Washington has a system where this would need to be determined through case law. In this instance, that means a CPA would need to complete a BOI form, be sued, have the case go through the legal system and be decided likely by the State Supreme Court, before a definitive answer could be given on whether this is considered UPL in Washington.

Last year, the WSCPA spoke with the Washington State Bar and the State Supreme Court to request guidance from them on the matter. In both instances they said they could not provide legal advice.

Given the uncertainty in Washington and states across the country, many multi-state firms have decided they will not complete this work, and many large insurance carriers have said they will not insure it. However, CAMICO released BOI coverage considerations for CPAs firms on February 13 and CNA has shared risk management considerations as well.

For CPAs in Washington who are still looking at this issue, while it is not definitively prohibited in Washington, there are many risks associated with completing BOI forms that any firm or individual should consider carefully before including them in an engagement.

Mike Nelson is WSCPA Manager of Government Affairs. Contact Mike via email.