Beneficial Ownership Information (BOI) reporting requirements
Updates to Beneficial Ownership Information Reporting Deadlines – Beneficial Ownership Information Reporting Requirements Now in Effect, with Deadline Extensions
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.
- As indicated in the alert titled “Notice Regarding National Small Business United v. Yellen, No. 5:22-cv-01448 (N.D. Ala.)”, Plaintiffs in National Small Business United v. Yellen, No. 5:22-cv-01448 (N.D. Ala.)—namely, Isaac Winkles, reporting companies for which Isaac Winkles is the beneficial owner or applicant, the National Small Business Association, and members of the National Small Business Association (as of March 1, 2024)—are not currently required to report their beneficial ownership information to FinCEN at this time.
On Tuesday, December 3, 2024, in the case of Texas Top Cop Shop, Inc., et al. v. Garland, et al., No. 4:24-cv-00478 (E.D. Tex.), the U.S. District Court for the Eastern District of Texas, Sherman Division, issued an order granting a nationwide preliminary injunction. On December 23, 2024, the U.S. Court of Appeals for the Fifth Circuit granted a stay of the district court’s preliminary injunction enjoining the Corporate Transparency Act (CTA) entered in the case of Texas Top Cop Shop, Inc. v. Garland, pending the outcome of the Department of the Treasury’s ongoing appeal of the district court’s order. Texas Top Cop Shop is only one of several cases that have challenged the CTA pending before courts around the country. Several district courts have denied requests to enjoin the CTA, ruling in favor of the Department of the Treasury. The government continues to believe—consistent with the conclusions of the U.S. District Courts for the Eastern District of Virginia and the District of Oregon—that the CTA is constitutional. For that reason, the Department of Justice, on behalf of the Department of the Treasury, filed a Notice of Appeal on December 5, 2024 and separately sought of stay of the injunction pending that appeal with the district court and the U.S. Court of Appeals for the Fifth Circuit.
News alert: Texas Federal Court Halts Corporate Transparency Act Enforcement
On December 3, 2024, a Texas federal district court judge in the case of Texas Top Cop Shop, Inc., et al. v. Garland, et al., No. 4:24-cv-00478 (E.D. Tex., Dec. 3, 2024) issued a preliminary injunction nationwide, temporarily halting the enforcement of the Corporate Transparency Act (CTA) and the U.S. Department of the Treasury’s Financial Crimes Enforcement Network’s (FinCEN) regulations on Beneficial Ownership Information Reporting Requirements (BOI Reporting Requirements). These regulations, which went into effect on January 1, 2024, mandate that reporting companies file a BOI Report with FinCEN, including details about the reporting company, its beneficial owners, and its company applicants.
While FinCEN is expected to challenge this decision, no public response has been issued. Therefore, the future of the BOI Reporting Requirements remains uncertain. In the meantime, reporting companies should be prepared to comply with the stated deadlines for BOI Report submissions.
Key Deadlines:
Reporting companies created or registered to do business in the U.S. before January 1, 2024, must submit their BOI report by January 1, 2025.
Reporting companies created or registered between January 1, 2024, and December 31, 2024, are required to file their BOI Report within 90 days of formation or creation.
As you may be aware, the Beneficial Ownership Information (BOI) reporting requirements under the Corporate Transparency Act (CTA) have been in effect since January 1, 2024. This law, administered by the Financial Crimes Enforcement Network (FinCEN) division of the U.S. Treasury, requires many businesses to disclose information about their beneficial owners. Compliance is essential to avoid penalties.
Who is Required to File?
Most corporations, limited liability companies (LLCs), and other entities must file a BOI report unless an exemption applies (click here for a list of the exemptions).
What Must Be Filed?
The BOI report must include information about each applicant and each beneficial owner.
An applicant is the person responsible for applying for the company’s charter/articles of incorporation/formation.
A Beneficial Owner is any person who owns 25% or more of the equity, any director, or any officer who exerts significant control over the governance of the entity.
Required information:
Full legal name
Date of birth
Current residential or business address
A unique identifying number from an acceptable identification document (e.g., passport or driver’s license), along with an image of the document
If You Have Not Already Done So:
If you still need to complete your BOI filing, it is critical to do so as soon as possible. Non-compliance can result in substantial penalties, including fines of up to $500 per day, and in certain cases, criminal penalties may also apply.
For entities formed in the calendar year 2024, the deadline for filing a BOI report is 90 days from the date of formation. For all other entities that existed before January 1, 2024, the deadline to file is December 31, 2024.
If you believe your business is subject to the BOI filing requirements or would like to discuss having Chehardy Sherman Williams handle the filing of the BOI report on your behalf, please email us at info@chehardy.com or call our offices at (504) 977-2687. We are prepared to assist you in maintaining compliance and can help facilitate the filing process. If you choose to file your own FinCEN reports, use this link to the website: https://www.fincen.gov/boi
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