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Year-End Beneficial Ownership Information (BOI) Reporting Update

There has been significant confusion regarding what happened during December 2024 regarding the Beneficial Ownership Information (BOI) reporting requirements of the Corporate Transparency Act’s (CTA).

Here is a breakdown of recent actions regarding the BOI reporting requirements:

  • December 3, 2024: The U.S. District Court for the Eastern District of Texas issued a nationwide preliminary injunction, temporarily halting enforcement of the CTA’s BOI reporting requirements.  
  • December 23, 2024: The U.S. Court of Appeals for the Fifth Circuit stayed the preliminary injunction, reinstating the CTA’s reporting obligations. In response, the Financial Crimes Enforcement Network (FinCEN) extended the reporting deadline to January 13, 2025, for companies created or registered before January 1, 2024.  
  • December 26, 2024: A different panel of the Fifth Circuit vacated the stay, reinstating the preliminary injunction. Consequently, reporting companies are not currently required to file BOI reports with FinCEN.  

The final court ruling on this matter is anticipated in the coming months. Given the ongoing legal proceedings, experts are recommending that all companies continue to gather the necessary information to file BOI reports, should the requirement be reinstated. While filing is currently voluntary, proactively preparing will facilitate compliance if mandatory reporting resumes.

Please contact us for more information.

On Tuesday, December 3, 2024, a federal district court found that the Corporate Transparency Act (CTA) is likely unconstitutional. An order was issued prohibiting the enforcement of the CTA and the Beneficial Ownership Filing Requirements. 

Describing the CTA as “quasi-Orwellian,” the court stated that the legislation is “likely unconstitutional as outside of Congress’s power.” according to reporting from the AICPA’s Journal of Accountancy

Under the injunction, CTA and BOI reporting rules cannot be enforced. Companies no longer need to comply with the Jan. 1, 2025 reporting deadline. 

A+P CPAs is monitoring the change in the BOI reporting requirements. Please contact us with any questions. 

Beneficial Ownership Information (BOI) Reporting

New BOI Requirements for 2024: Beginning in 2024, most corporations, LLCs, and other entities created or registered in the U.S. must report their Beneficial Ownership Information (BOI) to the Financial Crimes Enforcement Network (FinCEN).

What is BOI Reporting?

BOI Reporting is a legal requirement aimed at increasing transparency in ownership structures. It helps prevent money laundering, fraud, and other financial crimes by identifying individuals who own or control at least 25% of a company.

Who Needs to Report?

  • Corporations
  • Limited Liability Companies (LLCs)
  • Other U.S. entities
  • Foreign entities registered to do business in the U.S.
  • Exceptions:
    • Entities with 20 or more full-time employees, and
    • Has a physical location in the U.S., and
    • Reported more than $5 Million of Gross Receipts on the entity’s most recently filed income tax return.

Deadlines & Penalties:

  • Deadlines:
    • Entities established prior to January 1, 2024, must submit their reports by January 1, 2025.
    • Entities established between January 1, 2024, and January 1, 2025, have 90 days from creation or registration to submit their reports.
  • Entities established after January 1, 2025, have 30 days from creation or registration to submit their reports.
  • Penalties: Failure to comply can result in significant fines up to $500 per day and criminal penalties of up to $10,000 or 2 years in prison.

How A+P CPAs Can Help:

We specialize in guiding businesses through BOI compliance. Our services include:

  • Comprehensive BOI analysis
  • Filing assistance with FinCEN
  • Ongoing compliance support

Contact Us Today!

Avoid penalties and ensure compliance with BOI reporting regulations.

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