A federal appeals court on Thursday reinstated a nationwide injunction halting enforcement of reporting requirements for beneficial ownership information (BOI), reversing an order the same court issued earlier this week.
In his last orderThe Fifth Circuit Court of Appeals said it was reinstating a lower court order “to preserve the constitutional status quo while the merits panel considers the parties’ weighty substantive arguments,” referring to the panel of judges who will hear the appeal to decide.
The AICPA has urged the government to postpone the original BOI reporting deadline of January 1, 2025. The requirements are imposed by the Corporate Transparency Act (CTA) and enforced by the Financial Crimes Enforcement Network (FinCEN).
In a statement Friday, the AICPA said it is “seeking guidance from FinCEN and maintains its guidance for those assisting clients with BOI filings to gather the required information from clients and be prepared to file in the event the order is lifted again.”
On December 3, a federal district court in Texas issued the order Texas Top Cop Shop, Inc. against GarlandNo. 4:24-CV-478 (ED Texas 12/3/24). Under the order, the CTA and the BOI reporting rule were unenforceable, and reporting companies would not have to comply with the BOI reporting deadline of January 1, 2025, pending a new order from the court.
The Department of Justice (DOJ) appealed the order to the Fifth Circuit.
On Monday, a Fifth Circuit panel granted the DOJ’s motion to vacate the order. Another jury reversed that order Thursday.
Following Monday’s ruling by the Fifth Circuit, FinCEN announced that for reporting companies that were required to submit BOI information by January 1, 2025, their new filing deadline was January 13, 2025. As of 11 a.m. Friday, FinCEN had not issued any new comment on the BOI page.
Under the CTA, PL 116-283, which Congress passed in 2021 as an anti-money laundering initiative, reporting companies must disclose the identity of and information about the entities’ beneficial owners. For new entities incorporated after January 1, 2024, reporting companies must also disclose the identity of “applicants” – defined as any person applying to form a partnership, limited liability company or other similar entity.
The AICPA updates its program regularly BOI Reporting Center.
— To comment on this article or to suggest an idea for another article, please contact Neil Amato at [email protected].