Whoa…BOI, Here We Go Again My My … 🎶🎵🎹🎷 – Sung to the Tune of Mama Mia

Whoa, BOI…Oh NO Here We Go Again…

Beneficial Ownership Information (BOI) reporting requirements are covered in the Corporate Transparency Act (CTA); P.L. 116-283. FinCEN has estimated that 32 million small businesses would have to file BOI reports.

BOI in the BOX
BOI in the BOX

I was all set to schedule my post about Tax Strategies for Financial Growth and Quality of Life, when we received news that the Supreme Court has lifted the most recent BOI Reporting injunction.  This really is the gift that keeps on giving.  I have lectured on the requirements and “fine print” to my professional groups several times as a panel member with two of my professional friends the last time was December 18th.  We were “so done” with this yoyo of an issue as just the evening prior (December 17th 2024) there was news of a potential filing deadline postponement in the funding bill.   Now after a pause, it seems that the time has come to proceed based upon this latest ruling:

BOI Panel at 2024 ATS Tax Conference
BOI Panel at 2024 ATS Tax Conference

Yesterday (January 23, 2025) The Supreme Court issued a stay of the nationwide injunction against enforcement of BOI reporting requirements.  It was not immediately clear how the Financial Crimes Enforcement Network (FinCEN), which enforces BOI reporting requirements would react to this new ruling.  Please note the stay, is in effect until action by the Fifth Circuit and, potentially, further review by the Supreme Court.  In addition:

  • Justice Ketanji Brown Jackson dissented from the Supreme Court decision, saying the injunction should have stayed in force while the case is appealed
  • The question of whether the Corporate Transparency Act is constitutional is before the Fifth Circuit; Oral arguments are set for March 25, with a decision expected soon after
  • Republicans in Congress are trying to end the controversy through legislation.
  • The Fifth Circuit could put the injunction back in play, further complicating things.

We have continued to discuss the situation with our clients and professional colleagues and use best practices to make our recommendations.  In the end it’s up to the client to make the final decision.  I have seen that we only find fair in the dictionary and this ruling may be overturned with filings required during tax season when we have many deadlines, so we are assisting those clients of ours who have asked for help.  For those of you who have held off on filing please be reminded that there are huge civil and criminal penalties which may be assessed against those companies and their beneficial owners who willfully violate the filing requirement:

  • Civil penalties of $591 per day, up to $11,820 per violation
  • These fine amounts were adjusted as of January 25, 2024 pursuant to the Federal Civil Penalties Inflation Adjustment Act of 1990 (FCPIAA)
  • Criminal penalties of up to 2 years of federal imprisonment may apply for willful violations.

For those of you who would like to attempt to file on your own here are some useful links or click through to my December 6th blog post   or use the search bar for other posts detailing BOI reporting under CTA:

Fact Sheet : BOI Reporting Rule Fact Sheet

Brochure:  BOI Informational Brochure

Reference Guide:  BOI Reference Guide

Small Business Entity Compliance Guide: BOI Small Entity Compliance Guide

What’s next?

What does the Supreme Court’s ruling mean for small businesses? The answer to that question is unclear.  By lifting the injunction on the CTA, small-business owners will be required to file a BOI report. That much is understood. The Treasury Department’s Financial Crimes Enforcement Network (FinCEN) is responsible for collecting and enforcing beneficial ownership information reports. At the time of the Supreme Court’s ruling, FinCEN had not issued guidance or revised deadlines. It will provide updates at FinCEN.gov/boi.

The question of whether the Corporate Transparency Act is constitutional is before the Fifth Circuit. Oral arguments are set for March 25, with a decision expected soon after.

Final Thoughts/Recommendations

We are recommending that our clients review the rules; we will help with their decisions about filing the report.  We are also aware that banks may be requiring their business customers to show proof of filing in order to maintain their accounts in good standing and unless there is good reason not to file it makes sense to do so and move on.  Watching and waiting is very frustrating.

Feel free to search or website for some of our complementary resources or get in touch:  Contact us if you have tax concerns, tax minimization questions or want to discuss the next steps for your business success and financial goals. 

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