Injunction reinstated by the Fifth Circuit Court, BOIR filings are again voluntary (For Now).
We last reached out to inform you of an important decision made by the Fifth Circuit Court of Appeals which reinstated filing requirements under the Corporate Transparency Act (CTA), and a subsequent extension of the filing deadline to January 13, 2025. In that bulletin, we informed you that non-exempt corporate entities, including condominium and homeowner associations, may be obligated to file a Beneficial Ownership Information Report (BOIR) with the Financial Crimes Enforcement Network (FinCEN) no later than January 13, 2025, to avoid potential criminal and civil penalties.
In a rather unusual turn of events, a “merits panel” of the Fifth Circuit has reversed the decision issued Monday by a “motion panel” of the Fifth Circuit and has reinstated the lower court’s injunction on enforcement of the CTA’s BOI reporting requirements, to “preserve the constitutional status quo” while the merits of the matter are being decided.
In other words, the injunction is back in place, and any filing of the BOIR is currently VOLUNTARY. Although there is no legal requirement to file the BOIR currently, the filing requirements could be reinstated at any time, and if the filing deadline is not also extended either by the Court or by FinCEN, corporate entities that wait to file may face penalties for having failed to file timely. However, some corporate entities’ beneficial owners may have privacy concerns that they feel weigh against filing the BOIR on a voluntary basis to preempt any possible penalties. Each corporate entity will need to decide for itself how to proceed and must keep itself apprised of developments that may affect their filing requirements. There are multiple cases in the courts currently that could affect corporate entities’ filing and reporting requirements under CTA, so this is a fluid and evolving situation.
The above is provided as a courtesy for general informational purposes only and does not constitute legal advice. If your Association or other entity would like our assistance in deciding how to proceed, please contact us so we can provide legal advice specific to your situation.
You may access the U.S. Treasury’s Financial Crimes Enforcement Network (FinCEN)’s website at www.fincen.gov/boi to obtain more information and to submit your Beneficial Ownership Information Report.