Update – December 23, 2024
The Fifth Circuit Court has granted FinCEN’s appeal to lift the injunction on BOI reporting. FinCEN has responded with extended reporting deadlines. According to the FinCEN’s website:
In light of a December 23, 2024, federal Court of Appeals decision, reporting companies, except as indicated below, are once again required to file beneficial ownership information with FinCEN. However, because the Department of the Treasury recognizes that reporting companies may need additional time to comply given the period when the preliminary injunction had been in effect, we have extended the reporting deadline as follows:
- Reporting companies that were created or registered prior to January 1, 2024 have until January 13, 2025 to file their initial beneficial ownership information reports with FinCEN. (These companies would otherwise have been required to report by January 1, 2025.)
- Reporting companies created or registered in the United States on or after September 4, 2024 that had a filing deadline between December 3, 2024 and December 23, 2024 have until January 13, 2025 to file their initial beneficial ownership information reports with FinCEN.
- Reporting companies created or registered in the United States on or after December 3, 2024 and on or before December 23, 2024 have an additional 21 days from their original filing deadline to file their initial beneficial ownership information reports with FinCEN.
- Reporting companies that qualify for disaster relief may have extended deadlines that fall beyond January 13, 2025. These companies should abide by whichever deadline falls later.
- Reporting companies that are created or registered in the United States on or after January 1, 2025 have 30 days to file their initial beneficial ownership information reports with FinCEN after receiving actual or public notice that their creation or registration is effective.
Given this current update, if you haven’t made your BOI filing, please do so before the deadlines above. Instructions for filing are here.
Update – December 17, 2024
From the American Institute of Certified Public Accountants (AICPA), “The House released the draft continuing resolution on Wednesday, December 17 and it contains language the AICPA has fought to include for years: a 1-year delay to January 1, 2026, for BOI reports. The House is expected to vote as early as Thursday, December 18 and the Senate vote should follow shortly thereafter.”
Update – December 3, 2024
Judge Amos L. Mazzant III of the U.S. District Court for the Eastern District of Texas ordered the nationwide preliminary injunction in response to a motion from plaintiffs in Texas Top Cop Shop v.
Garland et al., with Mazzant finding the CTA was “likely unconstitutional as outside of Congress’s power.” The beneficial ownership information (BOI) reporting rule, adopted by FinCEN to implement the CTA, “is likely unconstitutional for the same reasons,” Mazzant’s order said.
In light of this injunction, the U.S. Financial Crimes Enforcement Network (FinCEN) encourages companies to voluntarily submit their beneficial ownership information as the Department of Justice appeals a nationwide injunction against the Corporate Transparency Act (CTA). The 5th Circuit Court of Appeals is moving quickly and may stay the injunction later this month, keeping the January 1, 2025, compliance deadline intact.
Original Post – August 14, 2024
Lately, there’s been a buzz in business circles about the Corporate Transparency Act (CTA) and its implications for business owners. This new legislation, effective January 1, 2024, introduces reporting requirements known as “beneficial ownership information reporting” (a BOI Filing). It’s a topic that has sparked curiosity and concern for some of our clients.
The Corporate Transparency Act (CTA)
The CTA, part of the National Defense Authorization Act for Fiscal Year 2021, mandates that certain entities disclose their beneficial ownership information (BOI). This includes details about individuals who own or control the company, affecting most LLCs, corporations, and partnerships. For entities formed in 2024, reporting must be done within 90 days of establishment. Existing entities have until January 1, 2025, to comply. In future years, new entities will have 30 days to file.
For a deeper discussion on the topic, we’ve prepared a white paper and linked it here.
Filing Requirements
Who: Companies in the U.S., including domestic and foreign entities, must comply with the CTA
What: These companies must disclose beneficial ownership information to FinCEN, including legal names, addresses, and identification details
When: The CTA took effect on January 1, 2024. Existing companies must report by January 1, 2025; companies established in 2024 have 90 days to file. Companies formed in 2025 and after have 30 days to file
Filing Guidelines
WG encourages compliance with the Corporate Transparency Act. We are not preparing BOI filings for our clients, and have the following options available to you for compliance:
Option 1: For a guided experience, we recommend BOI eFile. The cost is $224 per filing *
Option 2: If you’re comfortable filing on your own, there is a no-cost option available using the FinCEN’s filing portal
If you begin the process of filing the BOI Report and have professional questions, we encourage you to contact the attorney who drafted the entity’s formation documents.
* Securely handled by the “ Elite Cybersecurity Gurus” over at Truss. This is an affiliate link.
Conclusion
Navigating regulatory changes like the CTA can seem daunting, but staying informed and seeking appropriate professional advice will help ensure compliance and peace of mind for your business. We’re here to support you through business compliance exercises and look forward to assisting you however we can.
You can always reach us at: wgcpa.com