March 2025 Update
On March 2, 2025, the Treasury Department announced that it will not enforce fines or penalties with respect to beneficial ownership information reporting rules under the Corporate Transparency Act until new regulations are issued. The Treasury Department plans to issue new rules that would narrow the scope of BOI reporting to only require reporting by foreign companies.
On February 18, 2025, the judge in Smith, et al. v. U.S. Department of the Treasury, et.al., 6:24-cv-00336 (E.D. Tex.) removed a nationwide injunction preventing Financial Crimes Enforcement Network (FinCEN) from enforcing beneficial ownership information (BOI) reporting. FinCEN announced a new deadline for companies to take action.
Recent FinCEN Alert
An alert announced from FinCEN, states that the “BOI reporting requirements under the Corporate Transparency Act (CTA) are once again back in effect.” The alert also states that “FinCEN is generally extending the deadline 30 calendar days from February 19, 2025, for most companies.”
Highlights from the alert:
- Companies that should file an initial report or updated and corrected reports must do so by March 21, 2025.
- Companies that qualify for FinCEN’s limited hurricane disaster relief may still follow the April filing date.
- Penalties for late filing can be upwards of $500 per day.
Impact of Upcoming Legislation on BOI
On February 17, the House of Representatives passed legislation, H.R. 736, Protect Small Businesses From Excessive Paperwork Act of 2025, to delay BOI reporting for one year. If enacted, the deadline would move to January 1, 2026. The bill will be sent to the Senate for consideration. FinCEN also states that it will revisit the filing requirement for some small businesses to ease the compliance burden.
Several cases in multiple federal courts challenge BOI reporting. Early cases are on appeal to circuit courts.
Next Steps Forward
Please discuss these updates with your attorney and how they may impact your company’s reporting obligations under the CTA.
Cherry Bekaert is not offering consulting or compliance assistance to clients for BOI reporting under the CTA. We recommend that clients view the FAQs and Small Entity Compliance Guide posted by FinCEN. We also encourage businesses, owners and executives to discuss BOI reporting with their attorneys.
