In July, our team of attorneys published an article about a new corporate reporting requirement from the Financial Crimes Enforcement Network (FinCEN) that took effect on Jan. 1, 2024. Commonly referred to as the Corporate Transparency Act, the new regulations mandated various business types to complete an additional beneficial ownership filing or face penalties, which range from civil fines of up to $500 for each day a violation continues to criminal fines of up to $10,000 and possible imprisonment for up to two years.
Recently, a series of court orders has temporarily affected the enforcement of BOI filings and the penalties for not filing. As a result, FinCEN stated on its website that “reporting companies are not currently required to file beneficial ownership information with FinCEN and are not subject to liability if they fail to do so while the order remains in force.”
The key word here is “temporarily.” Filing requirements could be voided, reinstated, or modified at any time. Furthermore, our team at Nelson Law Group PC is not stating that you no longer need to submit a BOI filing for your company.
FinCEN recommends a proactive approach to filing to align with anticipated requirements and save time and effort later.
FinCEN Still Recommends BOI Filings
The U.S. Department of Treasury previously provided one year (until Jan. 1, 2025) to register all entities formed before 2024. Entities formed between January 1, 2024, and December 31, 2024, previously had only 90 days to file a BOI report. While the BOI requirements are temporarily voluntary, FinCEN urges business owners to file if they have not already done so).
Small corporations and LLCs that are subject to BOI reporting include those with the following characteristics:
- 20 or fewer full-time employees;
- $5 million or less in domestic gross receipts reported on their prior tax return and
- A physical presence within the United States
The online filing process appears straightforward and somewhat like the burden of filing for an EIN with the IRS.
The Basics of BOI Reporting
As stated in our first CTA blog, BOI reporting aims to reveal who owns and controls certain businesses. This makes it more difficult for shady individuals to hide behind their entities to evade taxes, launder money, etc. This initiative did not include every business type, though it did include single- and multi-member LLCs, Small S corporations, and Small C corporations.
Even if everything about your business, its officers, and beneficial owners is on the up and up, FinCEN still recommends that the new and existing entities mentioned above complete the appropriate filing as soon as possible.
Call Nelson Law Group Today!!
If you have questions about this or any other issue, it is always a good idea to talk to a lawyer about your situation. Give our knowledgeable staff at Nelson Law Group, PC, a call today. Our staff is always available.
Give us a call today! For more information about Brett A. Nelson, click here.
