FinCEN Delays Beneficial Ownership Reporting Deadlines, No Penalties Imposed

WASHINGTON, D.C. – February 27, 2025 – The Financial Crimes Enforcement Network (FinCEN) announced that it will not impose any fines or penalties against companies failing to meet the deadlines for beneficial ownership information (BOI) reports as outlined by the Corporate Transparency Act. This decision impacts the current deadline of March 21, 2025, during which companies are expected to file initial, updated, or corrected BOI reports.

FinCEN’s announcement came as a response to ongoing discussions regarding corporate compliance burdens and the need for clarity on reporting requirements. The agency indicated that enforcement actions related to BOI will be suspended until a forthcoming interim final rule becomes effective, which is anticipated by March 21, 2025.

“For now, we don’t need to worry about the March 21 deadline. This is good news, and we need to stay tuned for more from FinCEN,” said Melanie Lauridsen, vice president of tax policy and advocacy at the AICPA.

FinCEN is considering substantive revisions to the existing BOI reporting requirements, aiming to alleviate the burden on small businesses while ensuring the information remains vital for national security, intelligence, and law enforcement purposes. The intention behind the Corporate Transparency Act is to enhance transparency in ownership structures of companies in the U.S., thereby making it more challenging for illicit activities to be conducted through shell companies.

The upcoming interim final rule is expected to extend the deadlines for BOI filing, recognizing the complexities and implications for various entities. Reporting companies are currently free to file their BOI reports but may choose to delay submissions until the new deadlines are finalized.

Effective compliance with BOI reporting is essential; however, many organizations, particularly small businesses, have raised concerns regarding the potential burden posed by these requirements. The Corporate Transparency Act, enacted in January 2021, mandates that most businesses operating in the U.S. report their ownership details to FinCEN unless they qualify for specified exemptions.

Entities such as the National Small Business Association (NSBA), which succeeded in a legal challenge to the BOI requirements, are exempt from these filing obligations. Nonetheless, the penalties for non-compliance remain severe, including daily fines up to $591 for reporting violations and criminal penalties for willful failures, which can result in prison time and hefty fines.

NSBA President and CEO Todd McCracken commented, “While we appreciate the restraint and understanding FinCEN appears to be showing about the massive burden BOI reporting poses for millions of small businesses, we urgently need Congress to intervene and pass legislation that doesn’t harm small businesses and actually fixes the problem of money-laundering.”

Recently, the House of Representatives passed a bipartisan bill (HR 736) to extend the BOI reporting deadline to January 1, 2026; however, the Senate has yet to act on this legislation. Given the evolving regulatory landscape surrounding BOI reporting, stakeholders are encouraged to stay informed of upcoming changes and submit comments to FinCEN as it continues to seek input on these crucial reporting requirements.