What Is the BE-125? A Guide for U.S. Businesses With Cross-Border Service Transactions

Last week, we took a close look at the BE-180, a benchmark survey that zeroes in on financial services provided to foreign persons. It comes around once every five years, like a tax-season relative you don’t see often, but whose visit you can’t ignore.

Today, we're meeting its more talkative cousin: the BE-125. If your New Jersey business offers consulting, legal, tech, or professional services to clients outside the U.S., or licenses software or IP across borders, this quarterly report may already apply to you. Keep reading to find out what counts, who has to file, and why it’s better to stay ahead of the BEA than play catch-up.

Key Terms You Should Know

Before we roll up our sleeves and get into the nuts and bolts of BE-125 reporting for New Jersey businesses, let’s make sure we’re speaking the same language. Here are a few terms you should know to understand what this report is all about:

• U.S. reporter
  If the BEA wants to hear from you, it’s probably because you're the “U.S. reporter.” That means you’re the one responsible for submitting the data, usually the business entity that runs the books here in the U.S. In practice, that could be your New Jersey LLC, your C-corp, or another domestic arm of a larger business.

• Foreign person
  A “foreign person” is anyone or any entity based outside the U.S., including foreign clients, companies, or even foreign governments. If your limited liability company here in New Jersey sells enterprise services to someone abroad, they count. That’s who the BEA wants to know about.

• Affiliated vs. unaffiliated foreign persons
  In BEA terms, “affiliated” means a formal ownership link exists. If your New Jersey LLC owns at least 10% of a foreign company, or a foreign company owns 10% or more of yours, that’s an affiliated relationship. Anything outside of that? Unaffiliated. The BE-125 requires you to separate these two buckets when reporting services or royalties because the rules for each can differ.

• Intellectual property transactions
  For a lot of modern businesses, intellectual property is the product. Whether you're licensing cloud-based tools, letting others use your designs, or collecting royalties from digital content abroad, those earnings count as IP transactions. The BEA wants them broken out by country and affiliation, and that’s exactly what this section of the BE-125 is designed to capture.

• Cross-border selected services
  When the BEA says "selected services," they mean a defined list of services frequently sold across borders. Think professional services like legal, architectural, and advertising, or enterprise services like cloud-based support or management consulting. If your New Jersey business is exporting brainpower, not goods, chances are you're in scope. And if you're crossing that $6 million threshold, it's time to start reporting.

What Is the BE-125 Report?

The BE-125 is a quarterly survey conducted by the U.S. Bureau of Economic Analysis (BEA) to collect data on cross-border transactions in selected services and intellectual property. It’s how the federal government tracks the value of services exported from the U.S., not products, not ownership, but services.

If your New Jersey LLC sells or buys services from clients or vendors outside the U.S., this report might apply. You’ll need to separate what you’re selling from what you’re buying, break it down by country, and categorize it by whether the other party is affiliated with your business. Once you hit the threshold, filing is mandatory under federal law.

Who Must File the BE-125?

There are three filing statuses, and only one of them lets you off the hook completely.

• Mandatory filers
  You fall into this group if your New Jersey LLC or other U.S.-based business:

  • Sold over $6 million in a single category of intellectual property or professional services to foreign clients last year — or expects to this year.

  • Bought over $4 million in a specific type of covered service or royalty from a foreign person or company in the same timeframe.

  These numbers are tracked per transaction type, not as a grand total. So a single spike in, say, software licensing could trigger your reporting obligation.

• Voluntary filers
  If your New Jersey LLC works across borders and you weren’t contacted by the BEA, or your numbers are under the cap, you’re still allowed to file. That move tells regulators you’re paying attention. You’re organized.

• Exempt filers
  If the BEA contacted your New Jersey LLC, but you didn’t have any qualifying transactions in the categories listed, you're off the hook. But you still have to submit a claim of exemption. Think of it as formally saying, “Nothing to report.”

Services and IP Covered by the BE-125

When Is It Due?

You must file within 45 days of each quarter ending. For Q4, you get 90 days, that’s March 31 if your fiscal year ends in December. Here is a simplified breakdown:

If your business doesn’t follow a January-to-December calendar, that’s fine, just adjust your deadlines based on your own fiscal quarters. The rule stays the same: 45 days after each quarter closes, or 90 days for your final quarter.

And here’s one more thing to remember: if the BEA contacts you, you can’t ignore it, even if your company didn’t meet the reporting threshold. You still have to respond, either with your data or a formal claim of exemption.

Here is how to file:

• Electronic (preferred): www.bea.gov/efile

• Mail: BEA, Balance of Payments Division, BE-50, 4600 Silver Hill Rd., Washington, DC 20233

• Private Courier: Use Suitland, MD 20746 address

• Fax: (301) 278-9508

What Information Must be Submitted?

You must submit the following information in the appropriate sections of the BE-125 Report:

• Basic identifying info about your business

  • Legal name

  • Employer Identification Number (EIN)

  • Industry classification code

  • Fiscal quarter being reported

  • Whether you existed all quarter

  • Whether you were controlled by another U.S. entity

• Whether you bought or sold any of the following internationally

  • Intellectual property rights (e.g., patents, trademarks, software rights)

  • Selected services (e.g., legal, consulting, advertising, IT, R&D, etc.)

• The dollar value of each type of cross-border transaction

  • Total sales of each service or IP type to foreign persons

  • Total purchases of each service or IP type from foreign persons

• The country of each foreign counterparty

  • You must specify the country associated with each transaction

• Your relationship to the foreign party

  • Whether they’re an affiliate, a parent company, or totally unrelated

• The type of IP or service involved

  • Whether it was a license, a right to reproduce, or an outright sale (for IP)

  • Specific service category (like engineering, management consulting, etc.)

What Are the Consequences of Not Filing?

Ignoring your BE-125 filing obligation carries real penalties. If your New Jersey LLC misses a report, you’re risking fines, and in some cases, criminal charges. Here are the potential ramifications:

• Civil penalties can range from $4,454 to $44,539, depending on severity and whether it’s a repeat offense.

• Criminal penalties may apply if the failure is willful, including fines up to $10,000 and imprisonment for up to one year. That liability can extend to officers, directors, or employees who knowingly took part.

Conclusion

If your New Jersey LLC qualifies for BE-125 reporting, this doesn’t have to be one more overwhelming task. Just like you’ve found a rhythm for submitting payroll taxes, renewing your business registration, or maintaining your LLC operating agreement, you can build BE-125 into your quarterly workflow. Once you know the rules, it becomes just another part of running a smart, compliant business.

We invite you to join us next time for the next article in our BEA series, where we will discuss how to file BEA reports online.

Are you wondering about any of the issues mentioned above? Please email us at Info@staturelegal.law or call (732) 320-9831 for assistance.

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