As you may already be aware, the Department of the Treasury, through FinCEN, is now requiring the filing of a BOI Report for a broad range of small and midsized entities under the Corporate Transparency Act. While additional details are discussed below, all entities that are required to file a BOI Report that were formed prior to January 1, 2024, must file the BOI Report by December 31, 2024. If you are required to file and would like assistance with this filing, Mallor Grodner Plummer will be able to assist in this process if notified on or before November 30, 2024.
Who Needs to File
In general, the BOI reporting requirements apply to corporations, limited liability companies, and other similar business entities. Exceptions exist for certain entities, such as those that have more than 20 full-time employees in the United States and that reported over $5 million in annual gross receipts or sales on their previous year’s federal income tax return, as well as certain enumerated entities, including banks, insurance companies, accounting firms, and non-profit entities. Most small and midsized entities will be subject to this reporting requirement.
Deadlines
Entities formed on or before January 1, 2024, must file their BOI Report on of before December 31, 2024. Entities formed this year will have had 90 days to file the report, which we have discussed with clients for whom we have made such filings. Entities formed after January 1, 2025, while have 30 days to file a BOI Report, presuming the requirement is not overturned by legal action. You should also note that a variety of typical business events may also cause entities to have to file updates within 30 days on a going forward basis.
Legal Challenges
Some plaintiffs have challenged the BOI reporting requirements as an overreach by FinCEN; however, federal courts have thus far only stayed reporting for specific entities that have filed suit, not for all entities otherwise required to file. Therefore, while we remain hopeful that the reporting requirements may be broadly struck down, it is prudent to plan for the possibility that the requirement will remain in force through the December 31 filing deadline for entities formed prior to January 1, 2024.
The Filing Process
While the Department of the Treasury purports that the filing process is quick and simple, designed to enable businesses to file on their own, our experience indicates that the initial process can sometimes be complex and time-consuming depending on the specifics of ownership, issues with the filing system, and other factors that may require legal analysis.
How We Can Assist
If you would like Mallor Grodner Plummer to assist you with preparing and filing your BOI Report, we would be happy to discuss pricing for any entities you may have. Due to the impending deadline, and demand for business-related legal services toward the end of each calendar year, please let us know by November 30, 2024, if you would like our assistance. If notified after this date, we may not be able to assist with your filing.
Please do not hesitate to contact us with any questions or concerns regarding this new reporting requirement.