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In case you missed it, earlier this month a federal judge in Texas issued a nationwide injunction halting the enforcement of the Corporate Transparency Act (CTA). This decision temporarily paused the requirement for most corporations and LLCs to report their beneficial owners to the Treasury Department's Financial Crimes Enforcement Network (FinCEN). At the time, we advised businesses to remain prepared, as the injunction could be overturned.
What’s Changed:
On December 23, 2024, the U.S. Court of Appeals for the Fifth Circuit overturned that injunction, reinstating the CTA’s Beneficial Ownership Information (BOI) reporting requirements. However, recognizing the impact of the injunction, the Department of the Treasury has extended the compliance deadline for certain reporting companies.
What This Means for You:
- Extended Deadline: Reporting companies created or registered before January 1, 2024, now have until January 13, 2025, to file their BOI reports with FinCEN.
- For Companies Established After January 1, 2024: Specific deadlines may vary. Please check the FinCEN website for detailed filing requirements and timelines.
The CTA compliance requirements remain in effect, and we encourage you to act now to prepare your filings and avoid penalties. The legal battle surrounding the CTA continues, but businesses must meet these deadlines as they stand today.
To stay informed, please visit https://fincen.gov/boi, where alerts and updates are promptly posted on this home page.
Key Articles on BOI Reporting
For those who have been following our updates throughout the year, we’ve published a series of articles that break down the various aspects of BOI reporting:
- Simplifying the Corporate Transparency Act: What Your Business Needs to Know —This article provides a broad overview of the Corporate Transparency Act, explaining its goals and implications for all businesses, from small entities to large corporations. We focus on the "who, what, when, and why" of BOI reporting.
- Further Insights into BOI Reporting: Understanding the Role of a FinCEN Identifier — For businesses looking for a streamlined approach to reporting, this post dives into the FinCEN Identifier, a unique code that can simplify the process for businesses with complex ownership structures. If you’re considering this option, this is a must-read.
- Shedding Light: Updated Guidance on Beneficial Ownership Information Reporting Requirements — As the BOI reporting requirements evolved, we updated our guidance to keep clients current. This article breaks down the latest instructions from FinCEN, helping you understand the specifics you need to include in your filings.
- Reminder that BOI Reporting Deadline Just 60 Days Away — Are You Ready? — As the deadline nears, this article emphasizes the critical need for businesses to act now. Whether you're navigating compliance for a single-member LLC or a complex corporate structure, our insights will help ensure you're ready for January 1, 2025.
Act Now to Stay Compliant and Avoid Penalties
We recommend prioritizing your compliance efforts to meet the January 1 (or January 13 for certain companies) deadline and avoid potential penalties. While the CTA is currently enforceable, the legal battle is far from over. Efforts to challenge the statute and push for legislative changes are ongoing.
Stay prepared, as further developments could impact these requirements. We’ll continue to monitor the situation and provide updates as they unfold.
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