The United States Fifth Circuit Court of Appeals lifted the injunction imposed by a U.S. District Court in Texas on December 23, 2024. As a result, January 13, 2025 is the new deadline for FinCEN’s BOI Report for the vast majority of associated corporate and business entities. The Beneficial Ownership Interest (BOI) report was established by the Corporate Transparency Act (CTA), signed into law on January 1, 2021.
BOI reporting requirements were temporarily suspended by an injunction in the case of Texas Top Cop Shop, Inc., et al. v. Garland, et al., Case No. 4:24-cv-478, in which the District Court found that Congress had exceeded its authority and the CTA was unconstitutional.
The Fifth Circuit’s three-judge panel ruled that “the government has made a strong showing that it is likely to succeed on the merits in defending CTA’s constitutionality”. It removed the injunction imposed by the lower Court. What happens as a result of the delay between the original decision in Texas Top Cop Shop, Inc., et al. v. Garland, et al., and the rulings of the Fifth Circuit Court of Appeals?
The Financial Crimes Network (FinCEN) has issued a new “Alert” to update the reporting deadlines associated with the reporting deadline for the Beneficial Ownership Information form. The New deadline for FinCEN’s BOI Report will be January 13, 2025 for most “reporting companies,” with few exceptions.
The largest group of entities affected by this decision are those reporting companies formed before January 1, 2024. The original January 1, 2025 deadline has been extended to January 13, 2025 for those entities to complete and submit their BOI report. The January 13, 2025 deadline also applies to qualifying entities formed or registered on or after September 4, 2024 (who would have been required to file the BOI between the date of the injunction, December 3, 2024, and the date of the decision of the U.S. Fifth Circuit Court of Appeals, December 23, 2024.
FinCen will require qualifying reporting companies who came into qualifying existence “on or after December 3, 2024, and on or before December 23, 2024,” to complete their reporting requirements within 21 days of their original filing deadline.
Any qualifying entity coming into existence after January 1, 2025, will be required to file the associated BOI Report within 30 days of receipt of notification or creation.
Unfortunately, there are many entities within areas designated for disaster relief due to hurricanes Milton, Helene, Debby, Beryl and Francine. These companies may have had deadlines after the new date of January 13, 2025, and they should “abide by whichever deadline falls later,” according to FinCEN’s latest BOI Alert.
This new deadline for FinCEN’s BOI Report of January 13, 2025 should not come as a surprise to those who have been following the case closely. However, the ownership interests of many qualifying small businesses and corporations may be surprised to learn of the Fifth Circuit’s decision. If you hold a beneficial interest in a qualifying entity or company and are not one of the almost 8 million businesses that have already complied with the BOI reporting requirements, it is in your interests to consider this as a final extension and come into compliance as soon as possible.
We invite you to learn more about the integrated tax, legal, accounting and business consulting services of Allen Barron and contact us or call today to schedule a free consultation at 866-631-3470.