On February 17, 2025, a federal judge lifted the stay in Smith v. U.S. Department of the Treasury, effectively reinstating the nationwide injunction that prevented the government from enforcing the Federal Corporate Transparency Act (CTA).

Due to this court decision, the beneficial ownership information (BOI) reporting requirements under the CTA are back in effect. U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) issued an updated statement (below) on February 19, 2025 extending the filing deadline by 30 days to March 21, 2025, for most reporting companies including community associations.

 

How Does This Impact Community Association Board Members?

The compliance landscape for the Corporate Transparency Act (CTA) has seen significant whiplash, with legal battles causing multiple shifts in enforcement and deadlines.

Community association board members that have not yet filed their initial BOI reports, as well as those with changes to report from their initial filing, should plan to comply with the March 21, 2025 deadline.

 

FinCEN Statement Regarding the March 21, 2025 Deadline

From the FinCEN website (fincen.gov/boi):

“With the February 18, 2025, decision by the U.S. District Court for the Eastern District of Texas in Smith, et al. v. U.S. Department of the Treasury, et al., 6:24-cv-00336 (E.D. Tex.), beneficial ownership information (BOI) reporting requirements under the Corporate Transparency Act (CTA) are once again back in effect. However, because the Department of the Treasury recognizes that reporting companies may need additional time to comply with their BOI reporting obligations, FinCEN is generally extending the deadline 30 calendar days from February 19, 2025, for most companies.

Notably, in keeping with Treasury’s commitment to reducing regulatory burden on businesses, during this 30-day period FinCEN will assess its options to further modify deadlines, while prioritizing reporting for those entities that pose the most significant national security risks.

FinCEN also intends to initiate a process this year to revise the BOI reporting rule to reduce burden for lower-risk entities, including many U.S. small businesses.

Updated Deadlines

  • For the vast majority of reporting companies, the new deadline to file an initial, updated, and/or corrected BOI report is now March 21, 2025. FinCEN will provide an update before then of any further modification of this deadline, recognizing that reporting companies may need additional time to comply with their BOI reporting obligations once this update is provided.
  • Reporting companies that were previously given a reporting deadline later than the March 21, 2025 deadline must file their initial BOI report by that later deadline. For example, if a company’s reporting deadline is in April 2025 because it qualifies for certain disaster relief extensions, it should follow the April deadline, not the March deadline.
  • As indicated in the alert titled “Notice Regarding National Small Business United v. Yellen, No. 5:22-cv-01448 (N.D. Ala.)”, Plaintiffs in National Small Business United v. Yellen, No. 5:22-cv01448 (N.D. Ala.)—namely, Isaac Winkles, reporting companies for which Isaac Winkles is the beneficial owner or applicant, the National Small Business Association, and members of the National Small Business Association (as of March 1, 2024)—are not currently required to report their beneficial ownership information to FinCEN at this time.
  • For updates on other litigation related to the Corporate Transparency Act and its effect on reporting requirements for certain plaintiffs, see alerts below.

For more information, see FinCEN Notice, FIN-2025-CTA1, FinCEN Extends Beneficial Ownership Information Reporting Deadline by 30 Days; Announces Intention to Revise Reporting Rule (February 18, 2025).

Reporting companies can report their beneficial ownership information directly to FinCEN, free of charge, using FinCEN’s E-Filing system available at https://boiefiling.fincen.gov. More information is available at fincen.gov/boi.”

 

Background on the Corporate Transparency Act

In early 2024, the U.S. Federal Trade Commission (FTC) revealed that U.S. citizens lost $10 billion to scams in 2023. Over $750 million of these losses were attributed to “business imposters,” or scams where fraudsters posed as legitimate businesses utilizing fraudulent schemes and false identities. To address this risk, the federal government introduced the Corporate Transparency Act (CTA) enforced by the Financial Crimes Enforcement Network (FinCEN).

The Corporate Transparency Act (CTA) mandates that certain businesses disclose ownership information to the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN). The primary goals of the CTA are to increase business transparency and accountability in an effort to prevent illegal financial activities such as fraud, money laundering, and tax evasion. Beyond these benefits, proponents argue that beneficial ownership information (BOI) reporting can also help financial institutions and legitimate businesses foster trust with both customers and government entities.

Under the CTA, certain community associations will be required to report detailed information about their board members to the Financial Crimes Enforcement Network (FinCEN). Current board members of these associations are considered “beneficial owners” under the CTA.

Consequently, board members must provide FinCEN with detailed personal information, including their legal name, date of birth, residential address, and a copy of a valid, unexpired government-issued identification.

Penalties for non-compliance, whether intentional or not, could result in severe penalties, including daily fines over $500, penalties up to $10,000, and up to two years in prison.

 

Legal Resource

KSN will continue to monitor the situation, the status of the Corporate Transparency Act (CTA), the new March 21, 2025 deadline, and its impact on community associations.

If your board members would like to complete the beneficial owner information (BOI) reporting, KSN can provide legal assistance. Our law firm has invested significant time and effort into protecting our clients’ private information using high-grade encryption. KSN is prepared to assist board members in navigating the CTA’s requirements by:

  • Preparing and filing the correct documentation with the U.S. Department of the Treasury within the required reporting timeframe.
  • Providing proper board member personal identification to the U.S. Department of the Treasury in a secure manner.
  • Updating the U.S. Department of the Treasury when there are changes to your community association’s board (e.g., following annual elections or when a board member moves, etc.).

You can reach KSN by calling 855-537-0500 or visiting our website at www.ksnlaw.com.

Since 1983, KSN has been a legal resource for condominium, homeowner, and townhome associations. Additionally, we represent clients in real estate transactions, collections, landlord/tenant issues, and property tax appeals. We represent thousands of clients and community associations throughout the US with offices in several states including Florida, Illinois, Indiana, and Wisconsin.

 

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