The Financial Crimes Enforcement Network (FinCEN), under the Treasury Department, has stated that it will not impose fines or penalties on domestic companies that fail to file BOI reports. This suspension applies to both newly formed companies (on or after January 1, 2024) and existing companies (formed before January 1, 2024). This decision provides significant relief to business owners who were facing compliance deadlines and potential penalties under the new regulations.
In addition to the enforcement suspension, the Treasury Department has announced plans to introduce a proposed rule that will significantly narrow the scope of BOI reporting requirements. Under this proposal, only foreign companies—those registered in a U.S. state, U.S. territory, or U.S. tribal jurisdiction but originally formed in a foreign country—would be required to comply with BOI reporting.
The U.S. Treasury Department has the authority to modify reporting obligations as part of its role in implementing financial regulations. A comparable situation occurred with the ongoing delays in enforcing the reduced $600 reporting threshold for Form 1099-K, which was introduced under the American Rescue Plan Act of 2021. These adjustments illustrate how federal agencies can modify regulations to ensure smoother implementation and compliance for businesses.
For now, U.S. businesses can breathe a sigh of relief as the BOI reporting requirements are put on hold. However, companies should stay informed about future rulemaking from the Treasury Department and FinCEN to ensure compliance with any revised regulations. Business owners should also consult with their tax and legal advisors to understand how these changes may impact their reporting obligations.
Stay tuned for updates as more details emerge on the proposed rule changes and their implications for businesses across the country.
