The Financial Crimes Enforcement Network (“FinCEN”) has extended the deadline for reporting beneficial ownership information (“BOI”) under the Corporate Transparency Act (“CTA”) for reporting companies formed in 2024. Specifically, FinCEN has extended the filing deadline from 30 to 90 days from the date of formation for both domestic and foreign entities created or registered on or after January 1, 2024 and before January 1, 2025. The 30-day filing deadline for pre-existing entities, which must file BOI reports by January 1, 2025, is not affected.
The CTA is scheduled to become effective on January 1, 2024. In the short time between now and then, FinCEN still must promulgate final regulations regarding access to the BOI database, propose regulations on the alignment between the CTA and the Customer Due Diligence (“CDD”) Rule applicable to banks, and actually finalize the BOI reporting form. The time frame in which FinCEN must act is shrinking quickly. And, of course, the BOI database must be functional as a practical matter, and ready to effectively process many millions of CTA filings.
Indeed, when issuing this extension, FinCEN noted in the Federal Register publication that some commentators argued that an extension was necessary because FinCEN itself needed additional time to implement the BOI regulations. However, FinCEN rejected calls for an even longer extension – including through the end of 2024, or 90 days from the income tax return deadline for new companies (which would have benefitted CPAs and tax return preparers assisting clients with BOI reporting). FinCEN stated that a longer extension was unnecessary because “the [BOI] database must be reasonably up-to-date and accurate,” and because FinCEN “expects the public to become increasingly aware of the BOI reporting requirements as 2024 progresses, and in the coming years FinCEN will build upon its existing efforts to educate entrepreneurs who start new reporting companies.”