Navigating the Corporate Transparency Act (CTA) and Beneficial Ownership Information (BOI) Reporting

January 8, 2025
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Recent legal developments have introduced uncertainty regarding the Corporate Transparency Act (CTA) and its Beneficial Ownership Information (BOI) reporting requirements. To stay compliant, it’s crucial to understand your responsibilities and options under the current circumstances.

What Is the CTA?

The CTA mandates that many smaller corporations and LLCs file a BOI report with FinCEN (Financial Crimes Enforcement Network). These reports include identifying and contact information for individuals who own or control the entity. Importantly, the information collected is strictly for law enforcement purposes and will not be made publicly available.

The initial reporting deadlines were:

  • January 1, 2025 for businesses established before 2024.
  • 90 days from formation for new businesses registered in 2024.

However, these deadlines have been disrupted by recent court rulings.

Current Status of BOI Reporting

As of January 1, a nationwide injunction has delayed all BOI filing requirements. While this injunction remains in place, businesses are not required to file BOI reports. No penalties will apply for non-filing. The injunction impacts the following groups:

  • Pre-2024 businesses originally required to file by January 1, 2025.
  • 2024 businesses with a 90-day filing deadline from their date of formation.
  • Businesses needing to update previously filed reports due to changes.

Voluntary Filing: Should You Consider It?

Although the injunction has suspended mandatory filings, businesses may choose to file voluntarily. This proactive approach could simplify compliance in the long run and help avoid last-minute rushes if the injunction is lifted. Deadlines may be reinstated with little notice, so staying prepared is essential.

Key Takeaways

While the CTA’s reporting requirements are under judicial review, here’s what you need to know:

  • No action is currently required. You are not obligated to file your BOI report while the injunction is in effect.
  • Preparation is key. Begin gathering the necessary information to ensure you’re ready if the deadlines are reinstated.
  • Voluntary filing is an option. If you prefer to stay ahead of potential deadlines, you can submit your report now.
  • No additional action is needed for businesses that have already filed, unless there are reportable changes to update.

By staying informed and prepared, you can navigate the evolving legal landscape surrounding the CTA and its BOI reporting requirements with confidence.

For help with all your business and tax planning needs in 2025 and beyond, contact Illumination Wealth today.

 

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