Admin—The Jan. 1, 2025, deadline for reporting companies to file beneficial ownership information (BOI) reports could be extended by one year, based on a draft continuing resolution proposed in the House of Representatives.
The 1,500-page short-term funding bill, which would keep the government funded until March 14, 2025, could be voted on today by the House and shortly thereafter by the Senate. The continuing resolution, which would avert a Friday government shutdown, includes language on page 223 in Section 122, Extension of filing deadline for certain pre-existing reporting companies, that would extend the BOI reporting deadline for any reporting company formed or registered before Jan. 1, 2024, until Jan. 1, 2026.
The draft bill amends 31 U.S.C. Section 5336(b)(1)(B) "by striking 'before the effective date of the regulations prescribed under this subsection shall, in a timely manner, and not later than 2 years after the effective date of the regulations prescribed under this subsection,' and inserting 'before January 1, 2024, shall, not later than January 1, 2026.' "
In a LinkedIn post, Melanie Lauridsen, the AICPA's vice president–Tax Policy & Advocacy, said the bill "contains language we have fought to include for years," referring to the deadline extension.
The AICPA and state CPA societies have written numerous letters to Congress and to the Financial Crimes Enforcement Network, which enforces the Corporate Transparency Act (CTA), urging a delay in the reporting deadline.
The AICPA's BOI reporting resource center was updated Tuesday night to include a link to the continuing resolution.
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 "applicants" — defined as any individual who files an application to form a corporation, limited liability company, or other similar entity.
BOI reporting has been challenged in various courts, most recently in Texas. In that case, the Department of Justice (DOJ) asked the Fifth Circuit for a stay of enforcement pending appeal of a district court's preliminary injunction prohibiting enforcement of the CTA and its BOI reporting rule.
The injunction, which applies nationally, was issued in Texas Top Cop Shop, Inc. v. Garland, No. 4:24-CV-478 (E.D. Texas 12/3/24). Under the injunction, the CTA and the BOI reporting rule cannot be enforced, and reporting companies need not comply with the Jan. 1, 2025, BOI reporting deadline pending a further order of the court.
The DOJ asked the court to rule on its request for a stay by Dec. 27 "to ensure that regulated entities can be made aware of their obligation to comply before January 1, 2025."
— To comment on this article or to suggest an idea for another article, contact Martha Waggoner at Martha.Waggoner@aicpa-cima.com.
