Beneficial Ownership Information (BOI) Reporting Suspended
Attention JCCS clients! The Corporate Transparency Act (CTA) involving the filing requirement of the Beneficial Ownership Information (BOI) report by January 1, 2025, has been suspended.
What has changed?
On December 3, 2024, a federal district court in Texas issued an order granting a nationwide, preliminary mandate that: (1) enjoins enforcement of the Corporate Transparency Act and regulations implementing its beneficial ownership information (BOI) reporting requirements, and (2) stays all deadlines to comply with the CTA’s reporting requirements, including the January 1, 2025 deadline for reporting companies to submit their initial BOI report.
The Department of Justice, on behalf of the Department of the Treasury, filed an appeal of the district court’s decision on December 5, 2024.
The Financial Crimes Enforcement Network (FinCEN) has responded that as long as the preliminary mandate remains in effect:
- Reporting companies are not required to report BOI to FinCEN; and
- Reporting companies will not be subject to liability for failing to report their BOI.
FinCEN also indicated that reporting companies may continue to voluntarily submit BOI reports.
What does this mean for JCCS and their affected clients?
JCCS strives to be proactive in communication and compliance, especially in situations that could impact their clients directly.
As a result of this mandate, JCCS clients can now choose to (1) file the BOI report, or (2) wait to file the BOI report until further guidance is established.
What should JCCS clients expect to see in the future regarding the CTA and BOI Reporting?
The future of the CTA and BOI reporting, including when reports need to be submitted, remains fluid and unpredictable. While the Texas district court’s ruling may be the most recent decision issued, it is not the only case in which the CTA has been challenged. Federal district court decisions on the validity of the CTA have conflicted, and three district court cases are currently being appealed to their respective Courts of Appeals.
JCCS will continue to closely monitor developments, and JCCS clients should continue to be aware and watch for updates from other news sources, including the FinCEN Beneficial Ownership Information Reporting page.
