News Alert: Beneficial Ownership Information Reporting – Business Clients

This is to alert you to recent developments regarding Beneficial Ownership Information reporting, commonly referred to as BOI or BOIR. BOI filing is a requirement to everyone that owns an entity that is formed or registered the State such as an LLC, Corporation, or similar.

On December 3, 2024, a federal court in Texas issued a preliminary injunction blocking the enforcement of the Corporate Transparency Act’s (CTA’s) Beneficial Ownership Information reporting requirements. This means that reporting companies do not need to comply with the CTA’s January 1, 2025, BOI reporting date. However, on December 5, 2024, the Department of the Treasury (DOT) filed an appeal of the district court’s decision.

The Financial Crimes Enforcement Network (FinCEN) has responded that as long as the preliminary injunction remains in effect:

• reporting companies are not required to report BOI to FinCEN; and
• reporting companies will not be subject to liability for failing to report their BOI.

 FinCEN also indicated that reporting companies may continue to voluntarily submit BOI reports.

R&A is closely monitoring these developments. We will continue to track updates and share those with you as they are available. At this time, we do not know if DOT’s appeal will result in the injunction being lifted. If that does happen, we also do not know if BOI reports would be held to the original filing deadlines or a different deadline, nor do we know how penalties for late filing might be handled going forward. You  may need to comply with the CTA and BOI reporting requirements in the future if the CTA is ultimately upheld.

The American Institute of Certified Public Accountants (AICPA) has shared the following:

“The future of the CTA and BOI reporting, including when reports need to be submitted, remains fluid and unpredictable. While the Texas district court’s ruling may be the most recent decision issued, it is not the only case in which the CTA has been challenged. Federal district court cases are currently being appealed to their respective Courts of Appeals.”

If your business has already completed your BOI filing, there is no further action needed. If not, you may choose to file by the January 1, 2025, deadline despite the injunction, or wait and monitor developments. While R&A will keep you apprised of updates, you may also seek guidance from your attorney.