On December 23, 2024, the Fifth Circuit Court of Appeals overturned the injunction imposed by the US District Court for the Eastern District of Texas prohibiting FinCEN, the Treasury Department agency tasked with enforcing the Beneficial Ownership Information Report (BOIR) filing, from enforcing the requirements to file the new report by the end of year deadline.
This does not necessarily end the fight over whether the requirement to file this report is or is not constitutional, but it does make taxpayers face the decision of whether to file the report or risk penalties and not file until the case has made its way through the court system.
FinCEN has extended the filing deadline for all entities that were due on or before December 31, 2024 until January 13, 2025, due to the disruption caused by the last minute injunction issued in Texas.
We have already re-started the process to file the BOIR report for our clients, as it is unclear what the final outcome will be in this case, and it seems unlikely (but not impossible) that the U.S. Supreme court will take up this argument prior to the new extended deadline.
The Court is currently in recess, but will be in session again on December 27th, 30th & 31st. The U.S. Supreme Court does not typically schedule arguments in January, but that does not preclude the Court from hearing arguments in cases that are placed on the Emergency Docket.
The Beneficial Ownership Information Report is a required filing for most smaller entities that are formed and/or registered to do business in the United States. The report is being imposed under the pretense that the information will be used to combat money laundering in the United States. However, many critics point out that the types of organizations that will have access to this information could lead to data breaches that compromise the privacy of the information provided. Other critics argue that the report is completely ‘unconstitutional’ and a gross violation of privacy.