A bill to extend the deadline for an estimated 32 million small businesses to report their beneficial ownership information (BOI) as mandated by the Corporate Transparency Act (CTA) passed the U.S. House unanimously.

The House passed H.R. 736, Protect Small Businesses From Excessive Paperwork Act of 2025, 408–0, on Monday. The bill, which goes to the Senate next, extends the deadline for filing BOI reports to Jan. 1, 2026. The deadline for most reports previously was Jan. 1, 2025, but the reporting requirements have been caught up in numerous court cases and are now on hold.

A companion bill was introduced Tuesday in the Senate by Tim Scott, R-S.C., the chairman of the Senate Banking Committee.

"This is a simple solution that we've worked on together, and it's one of the most pressing concerns small businesses face," Rep. Zach Nunn, R-Iowa, who sponsored the bill, said on the House floor before the vote. "So, whether you're a Democrat or a Republican, we all have small businesses and a hometown responsibility to fight for them today."

Both bills affect only reporting companies existing before Jan. 1, 2024. Companies formed after that date are not affected.

Melanie Lauridsen, the AICPA's vice president–Tax Policy & Advocacy, said in a LinkedIn post that the proposed deadline extension is “hopeful information” – despite the possibility of court rulings changing reporting requirements at any moment.

The House and Senate bills support “the AICPA's long-standing position for a significant delay to help small businesses,” Lauridsen said.

A statement from the Financial Crimes Enforcement Network (FinCEN), which enforces BOI under the CTA, said: "Despite legislative and legal uncertainty, we continue to strongly recommend voluntary filing to get off this merry-go-round ride."

In the courts

In a motion filed last week in Samantha Smith and Robert Means v. U.S. Department of the Treasury, No. 6:24-CV-336 (E.D. Texas 1/7/25), the Department of Justice said FinCEN would extend BOI filing deadlines for 30 days if the court grants a stay of a nationwide injunction.

The government's motion asks the federal district court for the Eastern District of Texas to lift its nationwide injunction in Smith while the case is under appeal. The government cited the Supreme Court's decision to set aside another nationwide injunction involving BOI reporting requirements in Texas Top Cop Shop, Inc. v. Garland, No. 4:24-CV-478 (E.D. Texas 12/3/24).

Alternatively, the government asked the district court to modify its injunction so that it applies only to the plaintiffs in the case. On Monday, the court gave the plaintiffs a deadline of 5 p.m. Friday to file a response to the government's motion.

Background

Under the CTA, P.L. 116-283, which Congress passed in 2021 as an anti-money-laundering initiative, reporting companies must disclose the identity and information about beneficial owners of the entities. For new entities incorporated after Jan. 1, 2024, reporting companies must also disclose the identity of "company applicants" — defined as any individual who files an application to form a corporation, limited liability company, or other similar entity.

Willful violations are punishable by a fine of $606 per day, up to $10,000, and two years in prison with similarly serious penalties for unauthorized disclosure.

— To comment on this article or to suggest an idea for another article, contact Martha Waggoner at Martha.Waggoner@aicpa-cima.com.