To Clients and Business Owners,
Please be aware of this important update regarding the mandatory reporting deadline for reporting entities. On December 3, 2024, the U.S. District Court for the Eastern District of Texas issued a nationwide preliminary injunction enjoining the federal government from enforcing the Corporate Transparency Act (CTA) that established the Beneficial Ownership Information Reporting requirements. This means the Financial Crimes Enforcement Network (FinCEN), a Bureau within the Treasury Department, cannot currently enforce the Beneficial Ownership Information (BOI) Reporting Rule enacted pursuant to the CTA. The lawsuit asserted that the CTA is outside of Congress’ power to regulate under the Commerce Clause and is therefore unconstitutional.
The government has since appealed the injunction ruling to the Court of Appeals. At this point, we do not have any timeline on when the Court of Appeals may issue a ruling. After such ruling by the Court of Appeals, it could, of course, then go to the Supreme Court, but only if jurisdiction is accepted by the Supreme Court.
On December 7, 2024, FinCEN confirmed that reporting companies are not required to file beneficial ownership reports for as long as the current, nationwide injunction of the CTA remains in effect. FinCEN also indicated that reporting companies will have no liability for failing to file required beneficial ownership reports during the pendency of the injunction. FinCEN will continue to accept beneficial ownership reports from reporting companies on a voluntary basis.
As indicated, FinCEN’s BOI Reporting remains open and is accepting BOI Reports, despite the preliminary injunction. As of now, we suggest clients still consider filing as the Court system works through the process. Because that is an individual client decision, we will only take action as directed by each client (and we will take no action if we do not get any client response).
If you would like to engage HaasCaywood PC to complete your BOI Reports, please send the completed Engagement Letter, retainer fee, and the required documentation (e.g., copy of driver’s license). If you have already submitted this to engage our services, we will be in touch to confirm whether you would like us to proceed with the filing or wait until the courts have issued a final ruling.
For more information regarding the BOI Reporting, as well as the form required to engage HaasCaywood to file the BOI Report for your entities, please visit our website at:
https://www.haascaywood.com/beneficial-ownership-information-reporting/#section-2
We will continue to provide updates via Blogs on our website as more information becomes available (www.haascaywood.com/blog/).
If you have any questions about these new reporting rules and how they affect your business, we would be happy to discuss them with you. FinCEN also has a Small Entity Compliance Guide and frequently asked questions to help guide businesses through the reporting requirements. These are available at https://www.fincen.gov/boi/small-business-resources.
Sincerely,
HaasCaywood PC