By Neil Amato, for The Tax Advisor
A federal district court lifted the last remaining nationwide injunction stopping beneficial ownership information (BOI) filing requirements, but the federal enforcement agency has promised at least a 30-day delay before new filings will be required.
The order, in Samantha Smith and Robert Means v. U.S. Department of the Treasury, No. 6:24-CV-336 (E.D. Texas 1/7/25), granted a Department of Justice (DOJ) request for a stay of the court's nationwide injunction. The order was signed Monday.
The Financial Crimes Enforcement Network (FinCEN), which enforces BOI requirements under the Corporate Transparency Act (CTA), P.L. 116-283, said earlier in an alert on its site: "FinCEN intends to extend the reporting deadline for all reporting companies 30 days from the date the stay is granted. Further, in keeping with Treasury's commitment to reducing regulatory burden on businesses, FinCEN, during that 30-day period, will assess its options to modify further deadlines or reporting requirements for lower-risk entities, including many U.S. small businesses, while prioritizing reporting for those entities that pose the most significant national security risks."
At the time of publication, FinCEN had not updated its site with specific dates.
This is a developing story. Check journalofaccountancy.com for updates.
In lifting its injunction in the Smith case, the district court cited the Supreme Court’s Jan. 23 decision in McHenry v. Texas Top Cop Shop, Inc., No. 4:24-CV-478 (E.D. Texas 12/3/24), to lift a nationwide injunction in a separate Texas case challenging the BOI filing requirements.
Background
Under the CTA, which Congress passed in 2021 as an anti-money-laundering initiative, reporting companies must disclose the identity and information about beneficial owners of the entities. For new entities incorporated after Jan. 1, 2024, reporting companies must also disclose the identity of "company applicants" — defined as any individual who files an application to form a corporation, limited liability company, or other similar entity.
Most reports were originally due by the start of 2025; however, FinCEN pushed that date to Jan. 13, a deadline that the injunction made null.
Willful violations are punishable by a fine of $606 a day, up to $10,000, and two years in prison with similarly serious penalties for unauthorized disclosure.
AICPA advocacy
The AICPA and state CPA societies have written numerous letters to Congress and FinCEN, urging a delay in the reporting deadline.
The AICPA regularly updates its BOI reporting resource center.
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