BOI Update: Court Blocks Enforcement of Reporting Requirements
BOI Update Alert:
A recent ruling by a Federal U.S. District Court in Texas put a preliminary injunction preventing the enforcement of the CTA and BOI reporting requirement. Pending the final outcome of the proceedings, FinCEN is barred from enforcing the BOI deadline
Key Take Aways:
- The court ruling found that the CTA was “likely unconstitutional”.
- While the CTA is not currently enforceable, the court decision didn’t repeal the Act.
- Further proceedings are ongoing and the Department of Justice has the right to appeal both the injunction and the final decision of the court.
What This Means for You:
- Companies currently aren’t required to comply by the upcoming deadline of January 1, 2025, while the injunction is in place.
- It is possible, however unclear whether retroactive penalties could be assessed for late filings.
- There is no penalty for voluntary compliance if you have already filed or choose to file during the injunction.
- It is advisable to continue gathering the necessary information and be prepared to file if the injunction is lifted either before or after the deadline.
What’s Next:
We’ll continue to monitor the situation and keep you informed on any updates and provide you with further analysis and recommendations.
