As of January 1, 2024, most United States businesses were required to report information about the owners and controllers of the company to the Financial Crimes Enforcement Network (“FinCEN”). However, this new FinCEN reporting requirement has been challenged in several court cases across the country and the requirement is temporarily on hold, though voluntary reporting is still allowed.
On Tuesday, December 3, 2024, the U.S. District Court for the Eastern District of Texas, Sherman Division, issued an order granting a nationwide preliminary injunction, putting a temporary stop on the reporting requirement. On appeal to the U.S. Court of Appeals for the Fifth Circuit, a stay was granted on the injunction, thus reinstating the reporting requirement. FinCEN immediately issued an alert stating “reporting companies may have needed additional time to comply with beneficial ownership reporting requirements and extended the reporting deadline to January 13, 2025. On December 26, 2024, a different panel of the U.S. Court of Appeals for the Fifth Circuit reinstated the injunction, once again temporarily stopping the reporting requirement.
On December 31, 2024, the Department of Justice filed an emergency motion with the U.S. Supreme Court to remove the injunction and reinstate the reporting requirement. The Supreme Court set a deadline of January 10, 2025 for those challenging the FInCEN requirements to respond to the emergency motion. It is anticipated that a decision from the Supreme Court could be issued as early as January 13, 2025.
Pending any rulings by the Supreme Court, the FinCEN reporting requirement may be reinstated with a short window for filing the required reports. If you have a company that is required to report, and you have not done so already, it will be extremely important to stay informed about the Supreme Court’s ruling to determine whether you are required to report to FInCEN. For more information about what is required in the FinCEN Beneficial Ownership Information report, you can read this article and check out https://fincen.gov/boi. Our office is ready to help you file your reports should the requirement be reinstated or if you want to voluntarily report.
Comments