Latest on the CTA: FinCEN Extends Reporting Deadline for 2024
We have addressed the CTA in prior alerts (see, in particular, here, here, and here). Under the CTA, many newly formed and existing entities organized under state law, as well as entities formed under non-US law that register to do business in the United States, will be required to identify their beneficial owners and provide certain other information to FinCEN.
The CTA’s requirements go into effect on January 1, 2024. Reporting companies in existence before that date will be required to file their initial reports with FinCEN no later than January 1, 2025. A reporting company created on or after January 1, 2024, however, generally will be required to file its initial report within 30 days of its creation or registration. And a previously registered company will need to update its registration within 30 days of a change in its beneficial ownership or other information reported to FinCEN.
The new rule extends the 30-day deadline for filing an initial report from 30 days to 90 days, but only for entities that are formed in 2024. A company formed on or after January 1, 2025, remains subject to the general 30-day reporting timeframe.
The rationale for the new rule extending the initial reporting deadline is to provide reporting companies created or registered in 2024 with more time to familiarize themselves with their reporting obligations and the guidance published by FinCEN, as well as to resolve questions that might arise as they complete their BOI reports.
FinCEN explicitly declined to extend the reporting deadline beyond the 90-day timeframe specified in the rule or to apply the 90-day deadline to entities formed in 2025 and thereafter. FinCEN also emphasized that the 90-day period applies only to the filing of an initial report and not to filing updated or corrected BOI reports, which still will be subject to the general 30-day timeframe.