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The Financial Crimes Enforcement Network (FinCEN) has announced that it will not enforce the penalties under the Corporate Transparency Act (CTA), a major win for small businesses and the LBM industry. In addition, the March 21st reporting deadline is expected to be extended as FinCEN explores potential revisions to reporting requirements under the CTA. The press release from FinCEN states that companies will not be penalized for a failure to comply with the beneficial ownership information reporting requirements under the CTA.
“FinCEN announced that it will not issue any fines or penalties or take any other enforcement actions against any companies based on any failure to file or update beneficial ownership information (BOI) reports pursuant to the Corporate Transparency Act by the current deadlines. No fines or penalties will be issued, and no enforcement actions will be taken, until a forthcoming interim final rule becomes effective and the new relevant due dates in the interim final rule have passed.”
“NLBMDA commends the decision taken this week by the Treasury Department to suspend issuing penalties pursuant to the CTA,” said NLBMDA President & CEO Jonathan Paine. “This announcement follows months of aggressive advocacy efforts by NLBMDA which included outreach to members of Congress and the Trump administration”. Earlier this year, NLBMDA sent a letter to Treasury Secretary Scott Bessent urging the Administration to implement an administrative delay given the numerous legal challenges and lack of a legislative remedy that would delay the CTA.
In its statement, FinCEN directly acknowledged that the actions were part of a larger effort by the Treasury Department to reduce the regulatory burdens placed on businesses.
“This announcement continues Treasury’s commitment to reducing regulatory burden on businesses, as well as prioritizing under the Corporate Transparency Act reporting of BOI for those entities that pose the most significant law enforcement and national security risks.”
FinCEN writes that it will now begin the process of evaluating how the CTA will be enforced signaling that potential revisions to the current reporting requirements may soon be coming. On or prior to March 21st, FinCEN will update its guidance to extend reporting deadlines until after FinCEN completes its review. The agency has stated that it will solicit public comment during the rulemaking process. NLBMDA will closely monitor the new rulemaking and engage during the public comment period to ensure the perspectives of the LBM industry and the small business community are communicated.
For questions, please contact NLBMDA’s Government Affairs Coordinator, Matthew Delaney, at mdelaney@dealer.org.
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