Dear Clients and Friends:
On February 27, 2025, FinCEN announced that it will not issue any fines or penalties or take any enforcement actions against companies for the failure to file or update beneficial ownership information ("BOI") reports pursuant to the Corporate Transparency Act (the "CTA") until the United States Department of the Treasury provides new guidance. This was confirmed by a press release issued on March 2, 2025 which announced that, with respect to the CTA, the Treasury Department will not enforce any penalties or fines associated with the BOI reporting rule under the current deadlines.
The announcement from FinCEN indicated that it intends to issue an interim final rule no later than March 21, 2025 to extend BOI reporting deadlines, recognizing the need to provide new guidance and clarity as quickly as possible. Moreover, the Treasury Department indicated that (a) it will be issuing a proposed rulemaking that will narrow the scope of the BOI reporting rule to foreign reporting companies only and (b) it will not enforce any penalties or fines against U.S. citizens or domestic reporting companies or their beneficial owners after the anticipated rule change takes effect.
The Treasury Department stated that it was taking this step "in the interest of supporting hard-working American taxpayers and small businesses and ensuring that the rule is appropriately tailored to advance the public interest." The full FinCEN announcement can be found here: https://fincen.gov/news/news-releases/fincen-not-issuing-fines-or-penalties-connection-beneficial-ownership and the Treasury Department's full press release can be found here: https://home.treasury.gov/news/press-releases/sb0038.
What all of this means is that, for now, BOI reporting requirements have once again effectively been put on hold. The FinCEN announcement confirms that the previously announced March 21, 2025 deadline for filing BOI reports is no longer applicable, at least with respect to domestic entities, and the Treasury Department's announcement provides hope that the BOI reporting requirements may go away entirely for domestic entities.
Please contact your HH&K Attorney with any questions. We will continue to monitor future actions and developments with respect to the CTA from the Treasury Department, FinCEN, Congress and the courts and will keep you apprised of any further updates regarding these matters.
This Client Alert is not a substitute for legal guidance regarding program details and how those may be applicable to your business. As always, if we can be of assistance with these programs or any other matters, please do not hesitate to contact your HH&K attorney.
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