BOIR FILING UNDER THE CORPORATE TRANSPARENCY ACT IS TEMPORARILY PAUSED
If you are a small business owner, you’ve probably heard about the Corporate Transparency Act (CTA) and the new Beneficial Ownership Information Report (BOIR) requirements. You’ve also probably heard different reports on whether you have to file a BOI report for your company and the deadline for submitting it. But here’s some important news: you are no longer required to file the BOIR at this time.
A December 26, 2024 court ruling by the U.S. Fifth Circuit of Appeals has temporarily paused this reporting obligation again, and business owners need to understand what this means for them. In this blog post, we’ll break down what the CTA is, the reason for the pause, and what steps you should take next.
What is the Corporate Transparency Act (CTA)?
The Corporate Transparency Act was created to increase corporate transparency and fight financial crimes like money laundering. Under the CTA, most small businesses are required to disclose information about their “beneficial owners” — individuals who own or control the business — by filing a Beneficial Ownership Information Report (BOIR) with the U.S. Treasury’s Financial Crimes Enforcement Network (FinCEN).
What is the Beneficial Ownership Information Report (BOIR)?
The BOIR is a report that includes personal details about the individuals who ultimately control or benefit from a business.
The information required includes:
• Full legal name
• Date of birth
• Current address
• An identifying document (like a passport or driver’s license)
For businesses formed before January 1, 2024, BOI reports were due by December 31, 2024. If a business owner fails to file a BOI report, they could be subject to expensive fines and/or jail time.
Why Has BOIR Filing Been Paused? A Timeline
Several plaintiffs have filed lawsuits arguing that the CTA violates First Amendment rights and is unconstitutional.
On December 3, 2024, a federal judge issued a nationwide temporary injunction that stopped enforcement of the BOIR filing requirement. The federal government filed a notice of appeal.
On December 23, 2024, a motions panel for the U.S. Fifth Circuit Court of Appeals lifted the injunction and reinstated the BOIR requirements. The plaintiffs requested an emergency rehearing. That same day, FinCEN extended the reporting deadline to January 13, 2025.
On December 26, 2024, the U.S. Fifth Circuit the motion panel’s order lifting the injunction.
The key takeaway:
Filing your BOIR is now voluntary. You are not legally required to submit this report until further notice.
What Should Business Owners Do Now?
Here’s how you can stay ahead of the curve during this temporary pause:
1. Stay Informed. Keep up with updates on the status of the Corporate Transparency Act and BOIR requirements. The situation is fluid, and businesses will need to be ready if the pause is lifted.
2. Consult with an Attorney. Even though filing is currently voluntary, preparing for compliance now can save time and stress later. A small business attorney can help you understand your obligations and ensure your business is ready if the filing requirement resumes.
3. Organize Your Information. Gather the details of your business’s beneficial owners now so that you’re ready to file if the courts reinstate the requirement.
Final Thoughts
While the BOIR filing requirement has been temporarily paused, this situation is still evolving. Stay tuned — we’ll keep you updated on all the latest developments regarding the CTA and BOIR requirements.