Since January 1, 2024, entities formed by the filing of a document with any U.S. state, territory, or Indian tribe (domestic reporting companies), as well as any non-U.S. entities that register to do business with any U.S. state, territory, or Indian tribe (foreign reporting companies), have sought to comply with the Beneficial Ownership Information (“BOI”) reporting rule created by the enactment of the CTA in 2021. The BOI reporting rule requires the filing of reports with the Financial Crimes Enforcement Network (“FinCEN”), which is part of the Treasury Department. These reports provide certain information as to the entities’ beneficial owners. Under the BOI reporting rules, a beneficial owner is any individual who owns or controls at least 25 percent of the ownership interests in such an entity. In late 2024, the mandatory filing requirement was temporarily halted due to court orders in the Eastern District of Texas, but a recent order in that district court had reinstated mandatory filings by March 21st.
On Thursday, February 27th, as the new March 21st deadline approached, FinCEN announced that it would not issue any fines or penalties or take any enforcement action against any companies that missed the deadline or failed to update BOI reports under the current deadlines until a forthcoming interim final rule became effective and new relevant due dates in the interim final rule had passed (full statement available HERE). The announcement provided that FinCEN intended to issue an interim final rule no later than March 21st.
However, on Sunday, March 2nd, the Treasury Department announced that will not enforce penalties or fines associated with the BOI reporting rule under the existing regulatory reporting deadlines (full statement available HERE). Further, the statement provided that the Treasury Department will not enforce such penalties or fines against U.S. citizens or domestic reporting companies or their BOI owners after forthcoming rule changes take effect. Rather, the Treasury Department plans to issue proposed rules to narrow the scope of the BOI reporting rule to foreign reporting companies only.
The latest announcement by the Treasury Department appears to bring an end to BOI reporting for domestic reporting companies and their beneficial owners. The government has yet to provide any updates as to what it will do with the BOI information already reported by domestic reporting companies that complied with the mandatory filings throughout 2024 or filed in 2025 with the anticipation of a renewal of mandatory filing requirements.
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