What a BOIR!

Beneficial Ownership Reporting is dead! Well not really, some wish.

The Eastern District Court of Texas paused the requirement for Beneficial Ownership Reporting as part of the Coprorate Transpirancy Act, or CTA, which was due to start racking up eye watering fines for the federal government starting at the beginning of 2025.

The CTA was signed into law back in 2021 to combat money laundering, tax evasion, and trafficking to name a few. The information that is submitted to the Financial Crimes Enforcement Network (finCEN) is meant to only be disclosed to authorized government authorities and financial institutions. 

The required information would have been used to disclose the owners of more than 25% of any business, or a beneficial owner. Most small business entities which have filed with their Secretary of State, mostly Limited Liability Companies and Corporations, would have been required to file this report and to keep them up to date in case of any ownership changes, including address change of any owners within 30 days of said change. 

According to the Journal of Accountancy, only 6.5 Million out of 32 million reports have been filed thus far. That would have left a lot of small businesses open to the steep penalties for not completing the filing on time.

Even though the requirement has been paused, for now, finCEN has been vague about what a new deadline or timetable would look like if the act makes it out of judicial purgatory.

In order to counteract finCEN not being forthcoming with information, it is recommended that all businesses should file their reports timely according to the old deadline in case they retroactively fine businesses.

If you are ar DIY person, finCEN was so nice to provide a video on how to do the reporting yourself. See below: