BOI FORM UPDATE FROM 12/26/2024 - BENEFICIAL OWNERSHIP INFORMATION FORM UPDATE

THE REQUIRMENT TO FILE THE BENEFICIAL OWNWRSHIP INFORMATION FORM IS OFF AGAIN - FOR NOW!

On December 27, 2024, FINCEN (Financial Crimes Enforcement Network) issued and Alert regarding the BOI (Beneficial Ownership Form). What it means:

On December 3, 2024 a Texas Federal District Court issued an injunction against enforcement of the need to file the BOI Form. Reporting companies did not need to file the BOI Form pending appeal.
On December 23, 2024, the U.S. Court of Appeals for the Fifth Circuit granted a stay of the district court’s preliminary injunction. Reporting companies were again required to file the BOI Form, with extended deadlines listed below in this newsletter.
On December 26, 2024, a different panel of the U.S. Court of Appeals for the Fifth Circuit issued an order vacating the Court’s December 23, 2024, stay of the injunction. As of December 26, 2024, reporting companies are not requires to file the BOI Form.

Below is language of FINCEN's December 27, 2024, Alert. This is the link to FINCEN - Beneficial Ownership Information Reporting | FinCEN.gov. You should continue check with FINCEN for updates. If the requirement to file the BOI Form is reinstated, you will need to comply to avoid the hefty penalties.

"On December 23, 2024, a panel of the U.S. Court of Appeals for the Fifth Circuit granted a stay of the district court’s preliminary injunction entered in the case of Texas Top Cop Shop, Inc. v. Garland, pending the outcome of the Department of the Treasury’s ongoing appeal of the district court’s order. FinCEN immediately issued an alert notifying the public of this ruling, and recognizing that reporting companies may have needed additional time to comply with beneficial ownership reporting requirements, FinCEN extended reporting deadlines. On December 26, 2024, however, a different panel of the U.S. Court of Appeals for the Fifth Circuit issued an order vacating the Court’s December 23, 2024 order granting a stay of the preliminary injunction. Accordingly, as of December 26, 2024, the injunction issued by the district court in Texas Top Cop Shop, Inc. v. Garland is in effect and reporting companies are not currently required to file beneficial ownership information with FinCEN."

URGENT BUSINESS ALLERT - THE BENEFICIAL OWNERSHIP INFORMATION FORM MUST AGAIN BE FILED

Below is information we published in September 2024, warning businesses of the need to comply with the Corporate Transparency Act or suffer severe penalties. The act requires most businesses that file with the Secretary of State, to file the Beneficial Ownership Information Form (BOI) by certain deadlines. Then on December 3, 2024, a Federal District Court in Texas issued an order granting a nationwide preliminary injunction against enforcement of the act.

Now, on December 23, 2024, the U.S. Court of Appeals for the Fifth Circuit granted a stay of the district court’s preliminary injunction enjoining the Corporate Transparency Act. All businesses, with few exceptions, must now file the BOI form by the new deadlines or be subject to the $500+ a day penalty. Here is a link to the FINCEN web site Beneficial Ownership Information Reporting | FinCEN.gov. Immediately below are the new deadlines for compliance as reported by FINCEN. Further below is our September newsletter detailing the penalties and other information, but the current deadlines are set forth immediately below and at the above link.

"In light of a December 23, 2024, federal Court of Appeals decision, reporting companies, except as indicated below, are once again required to file beneficial ownership information with FinCEN. However, because the Department of the Treasury recognizes that reporting companies may need additional time to comply given the period when the preliminary injunction had been in effect, we have extended the reporting deadline as follows:

Reporting companies that were created or registered prior to January 1, 2024 have until January 13, 2025 to file their initial beneficial ownership information reports with FinCEN. (These companies would otherwise have been required to report by January 1, 2025.)
Reporting companies created or registered in the United States on or after September 4, 2024 that had a filing deadline between December 3, 2024 and December 23, 2024 have until January 13, 2025 to file their initial beneficial ownership information reports with FinCEN.
Reporting companies created or registered in the United States on or after December 3, 2024 and on or before December 23, 2024 have an additional 21 days from their original filing deadline to file their initial beneficial ownership information reports with FinCEN.
Reporting companies that qualify for disaster relief may have extended deadlines that fall beyond January 13, 2025. These companies should abide by whichever deadline falls later.
Reporting companies that are created or registered in the United States on or after January 1, 2025 have 30 days to file their initial beneficial ownership information reports with FinCEN after receiving actual or public notice that their creation or registration is effective.
As indicated in the alert titled “Notice Regarding National Small Business United v. Yellen, No. 5:22-cv-01448 (N.D. Ala.)”, Plaintiffs in National Small Business United v. Yellen, No. 5:22-cv-01448 (N.D. Ala.)—namely, Isaac Winkles, reporting companies for which Isaac Winkles is the beneficial owner or applicant, the National Small Business Association, and members of the National Small Business Association (as of March 1, 2024)—are not currently required to report their beneficial ownership information to FinCEN at this time.

On Tuesday, December 3, 2024, in the case of Texas Top Cop Shop, Inc., et al. v. Garland, et al., No. 4:24-cv-00478 (E.D. Tex.), the U.S. District Court for the Eastern District of Texas, Sherman Division, issued an order granting a nationwide preliminary injunction. On December 23, 2024, the U.S. Court of Appeals for the Fifth Circuit granted a stay of the district court’s preliminary injunction enjoining the Corporate Transparency Act (CTA) entered in the case of Texas Top Cop Shop, Inc. v. Garland, pending the outcome of the Department of the Treasury’s ongoing appeal of the district court’s order. Texas Top Cop Shop is only one of several cases that have challenged the CTA pending before courts around the country. Several district courts have denied requests to enjoin the CTA, ruling in favor of the Department of the Treasury. The government continues to believe—consistent with the conclusions of the U.S. District Courts for the Eastern District of Virginia and the District of Oregon—that the CTA is constitutional. For that reason, the Department of Justice, on behalf of the Department of the Treasury, filed a Notice of Appeal on December 5, 2024 and separately sought of stay of the injunction pending that appeal with the district court and the U.S. Court of Appeals for the Fifth Circuit."

BELOW IS FROM OUR SEPTEMBER NEWSLETTER

CORPORATE TRANSPARENCY ACT & THE BENEFICIAL OWNERSHIP INFORMATION FORM

With few exceptions, businesses that register with the Secretary of State (i.e.: LLC, Corporations...) must file the Beneficial Ownership Form (BOI) to the Federal Crimes Enforcement Network (FinCEN). The Beneficial Ownership Information Reporting Requirements Small Entity Compliance Guide, December 2023 - Version 1.1 reports that penalties for failing to report include, "... civil penalties of up to $500 for each day that the violation continues, or criminal penalties including imprisonment for up to two years and/or a fine of up to $10,000".

If your business filed with the Secretary of State on or before December 31, 2023, you must file by December 31, 2024. If your company registered in 2024, you must report within 90 days. All entities registered after January 1,2025 must file within 30 days. If you need to make any change to your existing business with your Secretary of State filing, you need to file an updated or corrected BOI form within 30 days of filing.

Below is information from the BOI Informational Brochure 508C.

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