Court puts BOI rule on hold (again)

The on-again, off-again requirement for business owners to file beneficial ownership information (BOI) is on hold one more time.

On December 26, a federal appeals court reinstated a lower court’s injunction that stopped enforcement of a January 13, 2025, BOI filing deadline for many small businesses in the U.S. On December 23, a different panel of judges on the court had lifted the injunction and ordered the BOI requirements to resume.

Under the rule, an estimated 32 million businesses in the U.S. would be required to file the report or face civil or criminal penalties. As the issue continues to drift through the courts, business may voluntarily file BOI reports and avoid potential last-minute scrambles if the injunction is again lifted. At least 6.5 million BOI reports have been filed so far.

Filing is free, and BOI forms and extensive resources are available online at fincen.gov/boi.

BOI’s path so far

Under the Corporate Transparency Act (CTA), the BOI reporting requirements went into effect on January 1, 2024. The requirements are intended to help prevent criminals from using businesses for illicit activities, such as money laundering and fraud. The CTA requires most small businesses to provide information about their beneficial owners – or the individuals who ultimately own or control the businesses – to FinCEN.

Under the CTA, the exact deadline for BOI compliance depends on the entity’s date of formation. Reporting companies created or registered before January 1, 2024, have one year to comply by filing initial reports, which means their deadline would be January 1, 2025. Those created or registered on or after January 1, 2024, but before January 1, 2025, have 90 days to file their initial reports upon receipt of their creation or registration documents. Entities created or registered on or after January 1, 2025, have 30 days upon receipt of their creation or registration documents to file initial reports.

District court issues an injunction

On December 3, the U.S. District Court for the Eastern District of Texas issued an order granting a nationwide preliminary injunction that enjoined the CTA (including enforcement of the statute and regulations implementing its BOI reporting requirements) and stayed all deadlines to comply with the CTA’s reporting requirements.

The U.S. Department of Justice, on behalf of the Treasury Department, filed an appeal in the case on December 5.

Fifth Circuit lifts the injunction

On December 23, the U.S. Court of Appeals for the Fifth Circuit issued a ruling to lift the preliminary injunction. FinCEN quickly announced that reporting companies were once again required to provide BOI. However, the January 1 deadline was extended to January 13, 2025, with some exceptions. For example, reporting companies qualifying for disaster relief may have extended deadlines beyond January 13.

Fifth Circuit upholds injunction

On December 26, the same Fifth Circuit court – but consisting of a different panel of judges – reversed its order and placed an injunction on the BOI rules. In its ruling, the court said it needed additional time to consider the merits of the case and issue its final ruling.

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