New BOI Report Deadline Extended to Jan. 13, 2025

The deadline for most reporting companies to file beneficial ownership information (BOI) reports with the Financial Crimes Enforcement Network (FinCEN) has been extended to January 13, 2025. This extension follows a recent court ruling that reinstated the reporting requirement after a temporary injunction had halted enforcement.  

Background:

The Corporate Transparency Act (CTA) mandates that companies operating within the United States disclose information about their beneficial owners – individuals who own 25% or more of the company’s equity. This legislation aims to combat money laundering, terrorist financing, and other financial crimes by increasing transparency and making it more difficult for illicit actors to operate anonymously.  

Legal Challenges and Injunction:

The implementation of the CTA faced legal challenges, with some arguing that the reporting requirements violated constitutional rights. In a significant development, a district court in Texas issued an injunction on December 3, 2024, temporarily halting the enforcement of the CTA and the BOI reporting rule. This injunction effectively prevented reporting companies from complying with the initial January 1, 2025, deadline.  

Government Appeal and Court Order:

The Department of Justice (DOJ) appealed the district court’s ruling, arguing that the injunction should be lifted.

On December 23, 2024, the Fifth Circuit Court of Appeals granted the DOJ’s motion, effectively reinstating the reporting requirement. In its order, the Fifth Circuit expressed strong support for the constitutionality of the CTA, significantly bolstering the government’s position in the ongoing legal battle.  

Extended Deadline for Reporting Companies:

Recognizing the potential disruption caused by the temporary injunction, FinCEN announced an extension of the BOI reporting deadline. The revised deadlines are as follows:  

• Reporting companies created or registered before January 1, 2024: New BOI Report deadline is January 13, 2025.
• Reporting companies created or registered between September 4, 2024, and September 24, 2024: New BOI Report deadline is January 13, 2025.
• Reporting companies created or registered between December 3, 2024, and December 23, 2024: 21 additional days from their original filing deadline.  
• Reporting companies qualifying for disaster relief: Extended deadlines may apply beyond January 13, 2025.  
• Reporting companies created or registered on or after January 1, 2025: 30 days to file after receiving notice of their creation or registration.  

Key Considerations for Businesses:

• Assess Compliance Status: Determine whether your company is subject to the BOI reporting requirements and understand the specific deadlines applicable to your situation.
• Gather Necessary Information: Identify and collect the required information about your beneficial owners, including their names, addresses, and dates of birth.
• Establish Internal Controls: Implement robust internal controls to ensure accurate and timely reporting and to maintain the confidentiality of sensitive data.
• Seek Professional Guidance: Consider consulting with legal and compliance professionals to navigate the complexities of the CTA and ensure compliance with the reporting requirements.

Conclusion:

The extension of the BOI reporting deadline provides some relief for businesses impacted by the recent legal challenges. However, the ongoing uncertainty surrounding the CTA highlights the importance of proactive compliance efforts. By understanding the requirements, gathering necessary information, and implementing appropriate internal controls, companies can minimize disruption and mitigate potential risks associated with the BOI reporting regime.