Alert: On Thursday, February 27, the Financial Crimes Enforcement Network (FinCEN) announced that it will not issue any fines or penalties or take any other enforcement actions against any companies based on any failure to file or update beneficial ownership information (BOI) reports pursuant to the Corporate Transparency Act (CTA) by the current deadlines. A forthcoming interim final rule will be issued no later than March 21, 2025.
Just days after reinstating the Corporate Transparency Act's beneficial ownership information (BOI) reporting deadline to March 21, 2025, FinCEN has walked back its decision. Instead, the agency announced it will issue an interim final rule by the same March date that further extends BOI reporting deadlines, citing the need to provide new guidance and clarity. As such, fines and penalties for noncompliance in filing a report will not be issued.
Here's what businesses need to know:
- BOI reporting is once again voluntary.
- Companies that have not yet filed should delay filing until FinCEN issues a subsequent statement outlining proposed rule changes and revised deadlines.
- Additionally, companies that have already filed a BOI report should not submit any updated or corrected reports until the interim final rule outlines deadlines and requirements.
- As demonstrated by the statements and events below, the
CTA and applicable filing deadline remain in flux. FinCEN has
committed to providing its interim final rule by March 21,
2025.
- FinCEN also intends to solicit public comment on potential revisions to existing BOI reporting requirements. FinCEN will consider those comments as part of a notice of proposed rulemaking anticipated to be issued later this year to minimize burden on small businesses.
- FinCEN will continue to prioritize Corporate Transparency Act reporting of BOI for those entities that pose the most significant law enforcement and national security risks.
- The House unanimously passed H.R.736, which would give FinCEN authority to extend the compliance deadline for pre-2024 reporting companies to January 1, 2026.
- The constitutionality of the CTA will be taken up by the 5th Circuit on March 25, 2025. Numerous other cases are challenging the CTA.
- On social platform Truth Social, President Donald Trump issued a statement indicating an intent not to enforce the CTA at all notwithstanding Congress' passage of the law: "Exciting news! The Treasury Department has announced that they are suspending all enforcement of the outrageous and invasive Beneficial Ownership Information (BOI) reporting requirement for U.S. Citizens. This Biden rule has been an absolute disaster for Small Businesses Nationwide. Furthermore, Treasury is now finalizing an Emergency Regulation to formally suspend this rule for American businesses. The economic menace of BOI reporting will soon be no more."
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