Written by Angie Spong & N'kia, Attorneys
Corporate Transparency Act (CTA) Reporting Re-Activated – What You Need to Know
Do you own an interest in an LLC or a corporation? If so, keep reading!
If you’re one of the many business owners who have an LLC or closely-held corporation, this update is crucial for you. The Corporate Transparency Act (CTA) impacts the reporting requirements for those who own an interest in these types of businesses, and recent court rulings have brought the CTA reporting requirement back into focus.
Many of our clients own interests in an LLC, perhaps for liability protection on rental properties, vacation homes, or other closely-held businesses registered in North Carolina, Virginia and Washington, DC. In 2024, a new law under the CTA required individuals with such ownership interests to file Beneficial Ownership Information (BOI) Reports with the federal agency known as FinCEN. This is an important regulatory change, as failure to file could result in civil and criminal penalties.
Even if you sit on the Board of your Homeowners Association (HOA), you may also be required to file a BOI report if the association is structured as an LLC or corporation. This is something many people overlook, but it’s a critical detail to be aware of.
At first, reports were required to be filed by the end of 2024. However, things have become more complicated with federal courts debating whether the reporting requirement is constitutional. On February 19, a court ruled that the reporting requirement should stand, but with a new deadline: March 21, 2025.
What does this mean for you?
It’s possible that the next court review could rule that the reporting requirement is no longer necessary before March 21. If you’re feeling uncertain about whether to file, you have a choice: You can either wait and see what the next court decision brings, or you can go ahead and file your report now to ensure you're in compliance. Filing is free and takes just a few minutes. While we cannot provide legal advice on whether or when you should file, we will continue to monitor developments and will send out updates based on the next court decision.
What do I do if I need to file?
You can file your BOI report at the official FinCEN website: https://boiefiling.fincen.gov. Be cautious—if you encounter a website that tries to charge you money to file, it’s likely a scam. The filing process itself is free and straightforward.
As always, we’re here to help ensure you're informed about key regulatory changes that affect your business. If you have any questions or need further clarification, don't hesitate to reach out. We're committed to keeping you updated and ensuring compliance with new laws that impact your business interests. See the attached flyer for specific information released from FinCEN and for a link to their site.
Why are you sending this now? (AKA the original alert)
As of February 19, 2025, the Corporate Transparency Act (CTA) is once again enforceable, which means that reporting companies are again required to file Beneficial Owner Information (BOI) reports. This is due to a new ruling in the case Smith v. U.S. Department of the Treasury, in which an order stayed a previously issued nationwide preliminary injunction that prevented the enforcement of the CTA.
FinCEN, the federal agency responsible for collecting BOI reports, has issued guidance clarifying the new filing deadlines. For most reporting companies, the new deadline to file an initial, updated, or corrected BOI report is March 21, 2025. However, reporting companies formed or registered on or after February 18, 2025, must file within 30 days from the date of creation or registration.
For more information, see FinCEN's official notice here.
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