UPDATE
On December 3, 2024, a Texas Federal Court granted a nationwide preliminary injunction against the Corporate Transparency Act. The court cited potential constitutional issues with the CTA BOI reporting and felt there was enough injury to warrant this preliminary injunction.
This injunction brings welcome relief to many of the approximately 32.6 million companies working through the filing. The preliminary injunction alleviates the immediate reporting requirements until the constitutionality issue can be settled in courts—most likely the Supreme Court.
Given the commencement of a new administration in 2025, the reporting regulations may be withdrawn or modified next year, or they could be found unconstitutional.
Businesses and individuals that have already filed do not need to take any further action. Those who have not filed are no longer obligated to do so at this time.
As always, we will keep you updated in 2025 when more information becomes available.
———————————————————————————————————————————–
If you’re a small business owner, you may not be aware of a new reporting requirement that could impact your company: the Beneficial Ownership Information (BOI) filing under the Corporate Transparency Act. Overseen by the U.S. Treasury, this obligation applies to most small businesses registered with a secretary of state or similar office.
Here’s what you need to know to stay compliant and avoid potential penalties:
What Is the BOI Reporting Requirement?
Unlike tax filings submitted to the IRS or state authorities, BOI reporting is required by the Financial Crimes Enforcement Network (FinCEN) under the U.S. Treasury. The goal is to enhance corporate transparency and combat illicit activities, such as money laundering.
Deadlines to File
- New Businesses: If your business was created or registered in 2024, you have 90 days from the date of creation to file your BOI report.
- Existing Businesses: If your business was in existence as of December 31, 2023, you have until December 31, 2024, to comply.
Legal Challenges and Potential Delays
Currently, there is ongoing confusion surrounding BOI filing requirements, driven by court cases and proposed legislation. While some lawmakers are pushing to delay the filing deadline, there’s no certainty that such measures will pass during the post-election “lame duck” session. Given the substantial fines for non-compliance, we recommend filing sooner rather than later.
How to File
The online filing process is straightforward:
- Visit FinCEN’s BOI E-Filing website.
- Click on the File BOIR tab or select the Get Started button.
Need Assistance?
The team at Canon Capital CPAs is here to answer any questions you may have about the BOI reporting requirement.