Treasury Secretary Janet Yellen speaks to reporters following a tour at one of the Financial Crimes … [+]
It appears that FINCEN’s Beneficial Ownership Information (“BOI”) reporting deadline will be moved to January 1, 2026, at least for companies that were required to file for 2024. This is related in the article by Kelly Phillips Erb, House Passes Bill To Delay Beneficial Ownership Information (BOI) Reporting Deadline (Feb. 11, 2025). It is not necessary to rehash the subject matter of that article, but suffice it to say that the U.S. House of Representatives unanimously (25 members did not vote) passed H.R. 736 which set the deadline back. So, it is almost certain that the deadline will be set back.
The purpose of this article is to warn that reporting persons and businesses had better fully prepare to file now, even if a filing is not immediately made because of an extension of the deadline. The reasons are very practical.
Consider that a reporting company must provide certain information relating to itself, such as the state and date of formation, but also information relating to its owners and controlling persons. If the company cannot provide this information, then the company cannot complete its filing. The company will then potentially face the harsh fines for a non-reporting violation.
But what can happen with the owners and controlling persons? Owners can sell their interests to others. Company officers or managers can quit or be fired. Both owners and controlling persons can move away, including abroad, without any forwarding information. They can die, go into a coma, go to prison, or simply disappear. When any of this happens, good luck getting the necessary information out of these persons.
What all this means is that whoever is going to make the BOI filing for the company had better accumulate this information now, while these persons are still associated with the company. Even if the company’s filing is delayed, or FINCEN makes changes to its BOI reporting regulations such that the particular company is never required to filed, at least the company will have been prepared to file without wasting effort trying to hunt down an owner or manager.
If such a person is reticent about supplying that information to the company, then have them apply for their own personal FINCEN identification number and then provide that number to the company. This is the preferred approach anyway, since it does not require companies to gather or keep any personal information itself, except for the innocuous identification number.
FINCEN has intimated that it plans to pare down the types of businesses that must file the BOI report to more closely target the entities most likely to be used for money laundering, etc., while relieving very low risk entities (think, Homeowners Associations and the like) from having to make the report. More on that in a future article, but if you think that the BOI reporting requirements are going to completely go away, you are quite likely to be disappointed.
For the here and now, companies should gather all the information necessary to make its 2024 filing as if the deadline were next week. If the deadline gets put off to January 1, 2026, as seems likely, well, great. At least when that deadline hits, then the company will not be trying to get a copy of the driver’s license from the family of a deceased owner or trying to get the necessary information from an unhappy former company officer.
Else, if you are the compliance person, you could very well spend this year’s holidays pulling your hair out trying to chase folks down and get them to provide their information timely.