BOI Reporting Reignited with New Deadline
Update February 27th – FinCEN announced there will not be any fines, penalties, or other enforcement actions taken based on a failure to file by the March 21, 2025 deadline. This policy will remain effective until the forthcoming interim final rules become effective (and new due dates have been approved). So it appears for now there will no penalties, or other enforcement action takes against those who do not meet the filing deadline. It is also apparent the agency plans to issue a new deadline within the interim final rule.
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The Corporate Transparency Act (CTA) requirement that companies and business owners complete annual Beneficial Ownership Information (BOI) reporting has been hotly contested for several months. Since late last year, various lawsuits have been filed and injunctions implemented and rescinded within weeks. Most recently, in the case of Smith vs. the U.S. Department of Treasury, adjudicated in the Eastern District Court of Texas, the court ruled the previous injunction should be removed and a new reporting deadline established. This means companies will have a new BOI reporting deadline to observe.
Following the ruling, the Financial Crimes Enforcement Network (FinCEN) issued FIN-2025-CTA1, which outlines filing details, including an updated deadline. According to the announcement, the filing deadline has been extended to March 21, 2025, for most companies. There are exceptions for certain companies, including those affected by natural disasters. This means companies have less than 30 days to compile, prepare, and submit a BOI report. To help clients, prospects, and others, Klatzkin has provided a summary of the key details below.
Updated Deadlines
FinCEN recently announced the new deadline for most reporting companies to file an initial, updated, and/or corrected BOI report by March 21, 2025. However, there are exceptions for those awarded an extended deadline due to being impacted by a natural disaster including Hurricanes Milton, Helene, Debby, Beryl, and Francine. These filers are not required to meet the new March deadline but rather should follow the extended April deadline as originally granted.
Reporting Requirements
The type of information which needs to be included in the filing depends on when a company was created. For those that registered on or after January 1, 2024, information about the company, its beneficial owners, and company applicants needs to be provided. For those who registered before January 1, 2024, information about the company and its beneficial owners needs to be reported.
- Company Information – A business needs to report its legal name, trade names, current principal place of business, jurisdiction of formation/registration, and Taxpayer Identification Number (TIN).
- Owner Information – The individual’s name, date of birth, residential address, and an identifying number from an acceptable identification document such as passport or U.S. drivers’ license must be provided.
- Applicant Information – For each company applicant, the individual’s name, date of birth, principal residence address, and an identifying number from an acceptable identification document such as passport or U.S. drivers’ license must be provided.
Please note that BOI reports must be submitted electronically using the PDF BOIR or the File Online BOIR.
Penalties for Non-Compliance
There are penalties for businesses that do not comply with the new deadline. According to the CTA, a person who violates the reporting requirements may be subject to civil penalties of up to $500 for each day the violation continues. In addition, these same individuals are at risk for criminal penalties, including up to two years of imprisonment and fines of up to $10,000. Triggering violations include purposely failing to file a BOI Report, providing false information, or failing to update/correct previous BOI reports.
Beyond this, corporate entities can also be held liable for such violations. This commonly occurs when a business willfully fails to report complete or update BOI to FinCEN. Under these circumstances, the cause of the failure will be assessed and if the company is found to be at fault, significant penalties may be assessed.
Contact Us
The new reporting deadline means that companies have less than 30 days to prepare and submit a BOI report. Now is the time to review requirements, compile information/make updates, and prepare to submit a report. If you have questions about the information outlined above or need assistance with another accounting issue, Klatzkin can help. For additional information call 609-890-9189 or click here to contact us. We look forward to speaking with you soon.