The Beneficial Ownership Information Reporting rule (BOI), implemented in January 2024, aims to increase transparency by requiring companies to report their true owners. This helps authorities fight financial crime. However, the rule faces legal challenges.
On March 1, 2024, a federal court in Alabama ruled the law behind BOI, the Corporate Transparency Act (CTA), unconstitutional. While the Department of Treasury is appealing this decision and continues to implement the CTA, only a limited group is currently exempt from filing BOI reports. This includes only the plaintiffs in the lawsuit and their associated businesses. These are: Isaac Winkles, reporting companies for which Isaac Winkles is the beneficial owner or applicant, the National Small Business Association, and members of the National Small Business Association (as of March 1, 2024). They are not required to report their beneficial ownership information to FinCEN.
For most companies, the BOI reporting requirement remains in effect. If your company was formed in 2024, you have 90 days to file. While you gather the required information, hold off on submitting the report until the deadline approaches. If you receive clarifying details sooner, file then.
Should you have any inquiries regarding the decision or CTA, please do not hesitate to contact us.
