FinCEN extends deadline for reporting companies created or registered in 2024 to file beneficial ownership information reports

Overview

On November 29, 2023, the Financial Crimes Enforcement Network (FinCEN) issued a final rule (Final Rule) extending the period to 90 days for companies formed on or after January 1, 2024, but before January 1, 2025, to file Beneficial Ownership Information Reports (BOI Reports) as required by the Corporate Transparency Act (CTA). 

Previous requirement

In September of 2022, FinCEN issued a final rule implementing the beneficial ownership reporting requirements of the CTA. The rule implements a reporting regime that goes into effect on January 1, 2024. While it provides numerous exemptions, the rule generally applies to both US entities—corporations, limited liability companies, limited partnerships and similar entities—as well as non-US companies that do business in the US.

Unless exempt, these "reporting companies" must file BOI Reports disclosing their beneficial ownership structures up through ultimate, natural person, beneficial owners as well as those with the power to control the operations of the entity, such as CEOs and COOs. Prior to yesterday's issuance, entities formed or registered on or after January 1, 2024 were required to file BOI Reports within 30 calendar days of notice of their creation or registration. For a more detailed discussion on the reporting requirements and more on our thoughts about how the provisions of the CTA may impact your private investment fund or family office, see our previous article, "What the CTA means for private investment funds and family offices."

Extension

The Final Rule grants reporting companies formed on or after January 1, 2024, but before January 1, 2025, an additional 60 calendar days—for a total of 90 days—to make their initial BOI filing. However, as originally promulgated, reporting companies that are created or registered on or after January 1, 2025 will continue to be required to file their BOI Reports with FinCEN within 30 calendar days of their formation or registration.

Key takeaways

Reporting companies required to file BOI Reports in 2024 will now have additional time to understand their regulatory obligations and collect the required information. Reporting companies should adopt procedures and provide instruction to the necessary individuals to ensure they understand what materials must be included in BOI Reports. Educational materials and guidance from FinCEN can be found on their website.

Relatedly, in December of 2022, FinCEN issued a notice of proposed rulemaking to address who would be able to access information contained in the BOI database. As of yet, FinCEN has not published a final rule addressing that issue. We will continue to monitor FinCEN's guidance and will release another alert should a final rule be published.