House Extends Deadline for BOI Reporting, Easing Compliance Burdens

The House passed a bill to ease the paperwork burden on small businesses. The “Protect Small Businesses from Excessive Paperwork Act” passed unanimously and moved the deadline to file beneficial ownership information with the Financial Crimes Enforcement Network (FinCEN) to January 1, 2026, for companies formed or registered before January 1, 2024.

Currently, companies formed or registered before January 1, 2024, have to file by January 1, 2025. Supporters of the bill say the extension will be a relief to many small businesses already burdened with compliance. 

Meanwhile, the regulatory landscape is still in flux. A recent federal judge in the Eastern District of Texas has put a hold on the mandatory filing of beneficial ownership information. In that case, the court found issues with the Corporate Transparency Act’s reach and impact on small businesses. So, companies don’t have to file these reports and won’t be penalized for non-compliance while the court’s order is in effect. FinCEN, the agency in charge of these filings, has confirmed businesses can still file voluntarily if they wish.

The dual developments of extended deadlines and a temporary court stay have made business owners feel relieved and uncertain. On the one hand, the new legislation seems to give us a more realistic timeline to comply; on the other hand, the ongoing legal challenges mean the rules could change again once the judicial challenges are resolved.

Lawmakers from both sides of the aisle have stressed the need for policies that reduce burdens on small businesses while still maintaining necessary oversight to prevent financial crimes. As the Senate considers the bill, industry experts say a stable and predictable set of rules will be crucial for small businesses to succeed in a competitive market.

For now, both the extended deadline and the temporary suspension of enforcement offer a window for relief. However, organizations are advised to stay updated and prepare for the potential changes to the Corporate Transparency Act.

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