Law Firm: Businesses Need to Monitor for Changes to FinCEN BOI Reporting Pause
Companies subject to the Treasury Department’s paused beneficial ownership information (BOI) reporting requirements are in a “state of bewilderment” after the Corporate Transparency Act rules were temporarily reinstated earlier this month only for them to be quickly placed back under a nationwide injunction last week (see 2412270046), Holland & Knight said in a Dec. 27 client alert. For now, the law firm said there “appears to be a set path forward and a reprieve from imminent compliance obligations” under the rules, which would have required most companies to submit BOI reports to the Financial Crimes Enforcement Network in January as part of a government initiative to prevent sanctioned parties and others from hiding assets in the U.S.
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Holland & Knight stressed that, as long as the current injunction remains in place, “companies have no obligation to comply with the BOI reporting obligation.” It also said there may be other court cases that challenge the legality of the law, and the Trump administration or Congress could decide to intervene in 2025, although it’s “not clear” what steps they may take.
Some lawmakers had called on the Treasury Department to push back implementation of the new requirements, partly because they said small businesses needed more time to comply (see 2411190066).
Holland & Knight said the “situation remains fluid” and reporting companies “should remain watchful, carefully monitor developments affecting CTA reporting requirements and be prepared to file if the injunction is once again lifted.”