On December 23, 2024, the Financial Crimes Enforcement Network (FinCEN) announced significant updates to the reporting deadlines for the beneficial ownership information (BOI). These changes affect most companies subject to the BOI reporting requirements and respond to a federal Court of Appeals decision that stayed the preliminary injunction enjoining the Corporate Transparency Act (CTA) in the case of Texas Top Cop Shop, Inc. v. Garland.
As of the beginning of December, over 90% of all pre-2024 companies (including LLCs and corporations) required to file BOI reports with FinCEN had not done so.
The Department of the Treasury recognizes that "reporting companies" may need additional time to comply with the BOI reporting requirements, given the period when the preliminary injunction had been in effect. Consequently, FinCEN has extended the reporting deadlines as follows:
- Pre-2024 Entities: Reporting companies created or registered before January 1, 2024, have until January 13, 2025, to file their initial BOI reports with FinCEN.
- Entities Registered Between September 4, 2024, and December 23, 2024: Reporting companies in this category with a filing deadline between December 3, 2024, and December 23, 2024, have until January 13, 2025, to file their initial BOI reports.
- Entities Registered Between December 3, 2024, and December 23, 2024: These reporting companies have an additional 21 days from their original filing deadline to file their initial BOI reports with FinCEN.
- Disaster Relief: Reporting companies qualifying for disaster relief may have extended deadlines beyond January 13, 2025, and should adhere to whichever deadline falls later.
- Post-2024 Entities: Reporting companies created or registered on or after January 1, 2025, have 30 days to file their initial BOI reports with FinCEN after receiving actual or public notice that their creation or registration is effective.
Exemptions from these deadlines include plaintiffs in National Small Business United v. Yellen, No. 5:22-cv-01448 (N.D. Ala.), who are not currently required to report their BOI.
Critical steps to ensure compliance
Given the tight deadline and the potential for severe penalties for non-compliance, including civil fines of up to $591 per day, criminal penalties of up to $10,000 per report, and up to two years of imprisonment, business owners, CPAs, and other professionals who advise them should take immediate action to acquire the information needed to file and do so to avoid the inevitable onslaught in the next few weeks.
Immediate action is imperative to ensure compliance with the January 13, 2025 deadline. Remember that we are only days away from the new year, and when companies are created or registered beginning January 1, 2025, they must file BOI reports in a very short period. The deadline to file is shortened from 90 days to 30 days from the creation/state registration date.
