On December 23rd, the Fifth Circuit Court of Appeals granted a DOJ motion to lift an injunction put in place by a Texas district court. With the injunction lifted, BOI filing is due on January 13th, 2025 for most filers.
As a result of this ruling, the previous requirements for filing with FinCen are reinstated, with an additional 12 days to file.
The case is still being litigated and the Fifth Circuit has not ruled on the merits of the case but in its order lifting the injunction, the court stated, “The government has made a strong showing that it is likely to succeed on the merits in defending CTA’s constitutionality.”
Below is the information related to BOI filing and information regarding how Smith Schafer can assist you with your filing.
BENEFICIAL OWNERSHIP INFORMATION (BOI)
The filing deadline for BOI reporting is January 13, 2025 for entities formed prior to 2024. BOI information needs to be submitted to FinCEN by that date or entities may face penalties of $591 per day. Additionally, individuals could face a fine of up to $10,000 and up to two years in prison if the failure to file is considered “willful”. Errors in filing may also be subject to penalties.
Who needs to file?
Most entities formed under state law will need to file and report BOI information. This includes: LLCs, C and S Corporations, HOAs, and LLPs. Generally, most non-profit organizations and governments are exempt from filing and certain larger entities (receipts over $5M who also file payroll tax returns) are also exempt. A list of exemptions can be found here. However, there is no minimum size for exemption so single member LLCs, which are often disregarded for tax purposes, are required to report.
What information needs to be reported?
Information related to the beneficial owners of each entity will need to be reported. This includes the beneficial owners: name, date of birth, residential address, identifying number from an acceptable identification document (generally, a driver’s license or a passport). An image of the identifying document will also need to be included.
Who is a beneficial owner?
Beneficial owners include: anyone owning 25% or more of an entity and anyone with financial control related to an entity including those with C Suite titles (CEO, CFO, CAO, COO, Etc.), those who can make financial decisions, and board members.
How do I report the BOI information?
You can file the report on your own using the BOI Efiling system: https://boiefiling.fincen.gov/ Please be sure to review the Small Entity Compliance Guide before filing because there are certain requirements that need to be met.
Can Smith Schafer help with filing?
Yes. We can help with the filing and are working to assist you using a software that will track your filing and the history of the information reported. You can email us to get the process started or to answer any questions you have regarding the filing. Our fee for filing is $450 per filing for a standard filing, additional hourly rate may apply for more complex entity ownership consultation.
When do you need my information if Smith Schafer is completing my filing?
Because the filing is due to be submitted to FinCen by January 13th, we need to have your information by January 1st to allow adequate time to follow up if there are outstanding items and to assist in making sure that all of the filings can be completed timely.
Is there anything else I need to know?
If the Fifth Circuit rules in favor of the government, it is likely that the plaintiffs will appeal the case to the Supreme Court. Ultimately, the law may be held unconstitutional by the Supreme Court, but while businesses await relief, the requirement to file remains.
