FinCEN Removes BOI Reporting Requirement for U.S. Companies and U.S. Persons; and Sets New Deadlines for Foreign Reporting Companies.
On March 21, 2025, the Financial Crimes Enforcement Network (“FinCEN”) announced that U.S. companies and U.S. persons will not be required to report beneficial ownership information (BOI). You can find FinCEN’s announcement HERE. You can find FinCEN’s interim final rule HERE.
WHAT DOES THIS MEAN FOR YOU?
- NO BOI FILING IS REQUIRED FOR ENTITIES CREATED IN THE U.S.
- FOREIGN COMPANIES THAT MEET THE NEW DEFINITION OF A “REPORTING COMPANY” AND THAT DO NOT QUALIFY FOR AN EXEMPTION, MUST REPORT THEIR BOI TO FINCEN UNDER THE NEW DEADLINES. The new deadlines are not set until FinCEN’s interim final rule is published, which is expected to occur at some point this year. We will continue to monitor and to keep you posted.
- ATTEND OUR CTA UPDATE WEBINAR. On April 1, 2025, at 10:00 a.m. Eastern Time, we will be hosting a CTA webinar to discuss FinCEN’s changes to the CTA’s reporting requirements. REGISTER HERE.
As always, feel free to reach out to legal@miamire.com if you have any questions!
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Find our past updates on the CTA roller-coaster below.
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Update March 4, 2025
UPDATE: FINCEN AND THE U.S. DEPARTMENT OF TREASURY HAVE ANNOUNCED NO FINES, NO PENALTIES, AND NO ENFORCEMENT ACTIONS AGAINST REPORTING COMPANIES FOR FAILING TO FILE BOI REPORTS.
The Corporate Transparency Act (“CTA”) has been a roller coaster! On February 27, 2025, the Financial Crimes Enforcement Network (“FinCEN”) announced that it will not issue any fines, penalties, or enforcement actions against reporting companies and owners for failing to file any Beneficial Ownership Information (“BOI”) reports by March 21, 2025. You can find FinCEN’s announcement HERE.
In addition, on March 2, 2025, the U.S. Department of the Treasury announced that, with respect to the CTA, not only will it not enforce any penalties or fines associated with the BOI reporting rule under the existing regulations, but it will further not enforce any penalties or fines against U.S. citizens or domestic reporting companies or their beneficial owners even after expected rule changes take effect. You can find the Treasury Department’s announcement HERE.
WHAT DOES THIS MEAN FOR YOU AND YOUR BUSINESS?
At this point, the CTA’s reporting requirements will not be enforced against reporting companies and owners. There will be no penalties or fines for failing to file BOI reports. Stay tuned for the interim final rule that FinCEN intends to issue by March 21, 2025.
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Update February 20, 2025
URGENT: THE CORPORATE TRANSPARENCY ACT’S REPORTING REQUIREMENTS ARE BACK IN EFFECT. FOR MOST, THE DEADLINE TO REPORT BENEFICIAL OWNERSHIP INFORMATION IS NOW MARCH 21, 2025.
On February 18, 2025, a federal court issued an order lifting the nationwide preliminary injunction that had prevented FinCEN from enforcing the CTA’s Beneficial Ownership Information (“BOI”) reporting requirements.
Following the federal court’s order, on February 19, 2025, FinCEN announced that BOI reporting requirements are back in effect with a new deadline of March 21, 2025. FinCEN also stated that from now until the new deadline, it would “assess its options to further modify deadlines, while prioritizing reporting for those entities that pose the most significant national risks.”
WHAT DOES THIS MEAN FOR YOU?
BOI reporting requirements under the CTA are back in place. Businesses should immediately assess whether they are classified as a “reporting company,” and if so, act expeditiously to file an initial, updated, and/or corrected BOI report before the March 21, 2025, deadline.
Reporting companies can file their BOI report directly with FinCEN, free of charge, using FinCEN’s E-Filing System.
Where can you find more information?
BOI Small Compliance Guide v1.1 (fincen.gov)
Beneficial Ownership Information Reporting | FinCEN.gov
TOOL KIT: MUST-KNOW ANSWERS TO YOUR TOP QUESTIONS. These are the top questions about the Corporate Transparency Act that you submitted to MIAMI REALTORS® – with short answers.
TOOL KIT: MUST-KNOW ANSWERS TO YOUR TOP QUESTIONS. These are the top questions about the federal court’s nationwide preliminary injunction that you submitted to MIAMI REALTORS® – with short answers.
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Update January 24, 2025
BREAKING NEWS: ON JANUARY 23, 2025, THE U.S. SUPREME COURT HALTED THE NATIONWIDE INJUNCTION ISSUED IN TEXAS COP SHOP, INC. NOTWITHSTANDING, A SEPARATE NATIONWIDE INJUNCTION WAS ISSUED BY A DIFFERENT FEDERAL JUDGE IN THE CASE OF SMITH v. U.S. DEPARTMENT OF TREASURY, WHICH REMAINS IN PLACE. ACCORDINGLY, FINCEN ANNOUNCED ON JANUARY 24, 2025, THAT DESPITE THE SUPREME COURT’S ACTION IN TEXAS TOP COP SHOP, REPORTING COMPANIES ARE NOT CURRENTLY REQUIRED TO FILE BENEFICIAL OWNERSHIP INFORMATION WITH FINCEN AS LONG AS THE NATIONWIDE INJUNCTION IN THE SMITH CASE REMAINS IN FORCE. YOU CAN FIND THE U.S. SUPREME COURT’S ORDER HERE.
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Update January 6, 2025
THE CORPORATE TRANSPARENCY ACT: FILING DEADLINES SUSPENDED AGAIN!
The U.S. Court of Appeals for the Fifth Circuit on December 26, 2024, vacated the stay and reinstated the nationwide preliminary injunction stopping enforcement of CTA and the BOI reporting requirements. In light of the appellate court’s most recent order, no filings under the CTA are currently required under the law.
In its order, the appellate court explained that it was taking such action to preserve the constitutional status quo while the court considers the parties’ substantive arguments on appeal. Given the appellate court’s order, “reporting companies” are currently not required to file their BOI reports.
On December 27, 2024, FinCEN announced on its website that given the appellate court’s order vacating the stay on the preliminary injunction, reporting companies are currently not required to file beneficial ownership information with FinCEN. Filing of BOI information at this point is entirely voluntary.
Reporting companies should continue to closely monitor the ongoing litigation regarding the constitutionality and enforceability of the Corporate Transparency Act.
WHERE CAN YOU FIND MORE INFORMATION?
Beneficial Ownership Information Reporting | FinCEN.gov
HERE you can find FinCEN’s Small Business Resources including:
- Small Entity Compliance Guide,
- Frequently Asked Questions,
- Quick Reference, and
- Short Introductory Videowith step-by-step instructions on how to file the BOI report.
COURT ORDER REINSTATING INJUNCTION
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Update December 26, 2024
URGENT: A FEDERAL APPELLATE COURT REINSTATED ENFORCEMENT OF THE CORPORATE TRANSPARENCY ACT. FOR MOST, THE DEADLINE TO REPORT BENEFICIAL OWNERSHIP INFORMATION IS JANUARY 13, 2025.
On December 23, 2024, a federal appellate court reinstated the filing requirements under the Corporate Transparency Act (“CTA”). Following the appellate court’s decision, any covered entity is once again required to report certain information about the entity and its beneficial owners to the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN).
Following the appellate court’s decision, FinCEN released a statement on its website extending certain reporting deadlines:
- Reporting companies formed or registered before January 1, 2024, have until January 13, 2025, to file their initial beneficial ownership information reports with FinCEN.
- Reporting companies formed or registered in 2024 must generally submit BOI reports within 90 days of the company’s creation or registration.
- For companies formed or registered on or after September 4, 2024, the deadline to submit initial BOI reports has been extended to January 13, 2025.
- For companies formed or registered on or after December 3, 2024, and on or before December 23, 2024, the deadline to submit initial BOI reports has been extended 21 days from whenever the initial filing deadline would otherwise have been.
- Reporting companies formed or registered on or after January 1, 2025, must submit a BOI report within 30 days after receiving notice of the company’s creation or registration, as was the case before the injunction.
Since the CTA’s reporting requirements are back in effect, entities should immediately assess whether they are classified as a “reporting company,” and if so, act expeditiously to complete and file BOI reports with FinCEN before the applicable deadline.
Where can you find more information?
BOI Small Compliance Guide v1.1 (fincen.gov)
Beneficial Ownership Information Reporting | FinCEN.gov
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Update December 5, 2024
BREAKING NEWS: ON 12/3/24, A TEXAS-BASED FEDERAL COURT ISSUED AN ORDER PROHIBITING THE FEDERAL GOVERNMENT FROM ENFORCING THE CTA ANYWHERE IN THE COUNTRY! “REPORTING COMPANIES” DO NOT NEED TO COMPLY WITH THE 1/1/25 DEADLINE.
On December 3, 2024, in Texas Cop Shop, Inc., et al. v. Garland et al., the United States District Court for the Eastern District of Texas, issued a nationwide preliminary injunction against the enforcement of the Corporate Transparency Act (CTA). The CTA mandates companies to file Beneficial Ownership Information reports with the Financial Crimes Enforcement Network (FinCEN).
WHAT YOUR OPTIONS ARE NOW:
- WAIT-AND-SEE. Given the nationwide injunction, no business is currently required to comply with the CTA. While you can wait and see what happens next, you should be aware that further court decisions can reinstate the CTA’s enforceability.
- PREPARE THE REPORT AND MONITOR THE CASE. Businesses that have not filed with FinCEN can delay filing their Beneficial Ownership Information reports. However, if the preliminary injunction is overturned on appeal, businesses may need to act expeditiously to meet reporting deadlines.
- FILE NOW. You still have the option to file now, regardless of the injunction.
As always, MIAMI REALTORS is committed to ensuring that you have the information you need to thrive in your businesses. We will continue to keep you posted on the status of litigation concerning the CTA.
TOOL KIT: MUST-KNOW ANSWERS TO YOUR TOP QUESTIONS. These are the top questions about the federal court’s nationwide preliminary injunction that you submitted to MIAMI REALTORS® – with short answers.
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Post November 13, 2024
DON’T MISS THE DEADLINE TO FILE YOUR REPORTS UNDER THE CORPORATE TRANSPARENCY ACT!
BY: MELISSA DEL VALLE, SENIOR LEGAL COUNSEL, AND AMANDA ALVARIÑO, UM LAW LEGAL EXTERN
What is the Corporate Transparency Act (CTA)?
The Corporate Transparency Act was enacted by Congress in 2021 to curb illicit finance. This law requires many companies who do business in the United States to report information regarding who owns or controls them. Effective January 1, 2024, “reporting companies” in the U.S. are required to report information about their beneficial owners and company affiliates to the Financial Crimes Enforcement Network (FinCEN), which is a part of the U.S. Department of the Treasury.
What is the deadline to report?
- December 31, 2024:Reporting companies created or registered before January 1, 2024.
- Within 90 days of creating a company:A reporting company created or registered on or after January 1, 2024, and before January 1, 2025, must report beneficial ownership information within 90 calendar days after receiving actual or public notice that the company’s creation or registration is effective, whichever comes first.
- Within 30 days of creating a company:A reporting company created or registered on or after January 1, 2025, must file a Beneficial Ownership Information report within 30 calendar days from actual or public notice that the company’s creation or registration is effective.
Which companies are required to submit reports to FinCEN?
The Reporting Rule requires that all reporting companies file Beneficial Owner Information (“BOI”) reports with FinCEN. There are two categories of reporting companies:
- A company that is a corporation, a limited liability company (LLC), or was otherwise created in the United States by filing a document with a secretary of state or any similar office under the law of a state or Indian tribe; or
- A foreign company and was registered to do business in any U.S. state or Tribal jurisdiction by filing a document with a secretary of state or similar office of the State or Tribe.
If a company meets either definition (1) or (2) AND does not qualify for an exemption, the reporting company is required to file a Beneficial Ownership Information report with FinCEN.
Which companies are not required to report?
Twenty-three (23) specific types of entities are exempt from the reporting requirements. An entity that qualifies for any of the listed exemptions is not required to submit Beneficial Ownership Information reports to FinCEN. Go to FinCEN’s Small Entity Compliance Guide which includes more information regarding the 23 exemptions and their requirements.
Who is a “beneficial owner”?
A beneficial owner is any individual who directly or indirectly exercises substantial control over a reporting company, or owns or controls at least 25 percent of the ownership interests of a reporting company. If an individual qualifies as a beneficial owner, information about that individual must be reported to FinCEN in the reporting company’s Beneficial Ownership Interest report.
Who is a company applicant and when is a company required to report company applicants?
A reporting company is required to report company applicants if it is either a:
- domestic reporting company created on or after January 1, 2024; or a
- foreign reporting company first registered to do business in the U.S. on or after January 1, 2024.
A reporting company is not required to report its company applicants if it is a domestic reporting company created before January 1, 2024, or a foreign reporting company first registered to do business in the U.S. before January 1, 2024.
There are two categories of company applicants: the first category is the direct filer and the second category is the individual who directs or controls the filing action.
- The direct filer must be identified by all reporting companies that have a company applicant reporting requirement.
- The individual who directs or controls the filing action is required to be reported when more than one individual is involved in the filing of the document that created or first registered the company.
- If more than one individual is involved in the filing, then two company applicants must be reported.
- No reporting company will have more than two company applicants.
How to report the required information?
Reporting companies can report Beneficial Ownership Information electronically through FinCEN’s website: https://www.fincen.gov/boiwww.fincen.gov/boi.
What happens if a reporting company fails to report beneficial ownership information in the required time frame?
The willful failure to report complete or updated Beneficial Ownership Information to FinCEN or the willful provision of or attempt to provide false or fraudulent beneficial ownership information, may result in civil or criminal penalties.
What happens if you want to update or correct information previously filed with FinCEN?
Updated reports are required when there is a change to previously reported information about the reporting company itself or its beneficial owners. Updated reports are due within 30 calendar days after a change occurs. If an inaccuracy is identified in a report that was already filed, the company is required to submit a corrected report no later than 30 days after the date the company became aware of the inaccuracy or had reason to know of it.
Where can you find more information?
BOI Small Compliance Guide v1.1 (fincen.gov)
Beneficial Ownership Information Reporting | FinCEN.gov
TOOL KIT: MUST-KNOW ANSWERS TO YOUR TOP QUESTIONS. These are the top questions about the Corporate Transparency Act that you submitted to MIAMI REALTORS® – with short answers.
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