The recent Corporate Transparency Act halt has left many Florida business owners unsure about what’s next about the new Beneficial Ownership Information (BOI) reporting requirements. Initially set to begin this year, the new rules would have required businesses to disclose who owns or controls them.
Even with the delay, however, owners should keep an eye out for updates on the law and start gathering the necessary information now so they’re ready when the rules go into effect.
What Is the Corporate Transparency Act Halt?
The Corporate Transparency Act (CTA) is a law that combats money laundering, among other illegal financial dealings, by requiring specified businesses to report their beneficial ownership to FinCEN. Due to the administrative and logistical challenges involved, the enforcement of BOI reporting had been put on hold.
For businesses in Florida, the Corporate Transparency Act halt means that the deadlines to file reports have been postponed, thus giving temporary relief. The delay, however, does not remove the obligation to file; it only delays enforcement, so businesses must remain alert.
Do Companies in Florida Still Need to File BOI Reports?
Yes, businesses subject to the CTA’s requirements will still need to file BOI reports once enforcement resumes. This includes corporations, LLCs, and other entities within the law’s scope.
This temporary Corporate Transparency Act halt affects the immediate BOI reporting due date; however, companies should not assume that this pause removes their obligations entirely. FinCEN has indicated that compliance will be expected once the deadlines are reinstated, and failure to file at such time may be subject to penalties.
Key Filing Requirements Under the Corporate Transparency Act
Although the timeline for enforcement was delayed, the requirements under the CTA remain the same. Firms will be required to file complex reports with FinCEN that include the following information:
- Identifying Beneficial Owners: Businesses must report the individuals who own or control at least twenty-five percent of the company or have significant influence over its operations.
- Sufficiency of Information: The name, date of birth, address, and identification number-either the passport number or driver’s license number-of each owner.
The details will aid in future complications for these entities formed in Florida and are specifically required for every LLC and corporation.
How Should Florida Businesses Prepare During the Halt?
This stay of the CTA has given businesses much-needed time to get into gear for compliance. This can be done in the following ways:
- Collect Beneficial Ownership Information: Ensure that all information about the beneficial owners is accurate and will be ready when the time for filing comes.
- Company Structure Review: Ensure your entity’s records and registration particulars conform to the requirements laid out by the CTA.
- Keep Informed: Pay attention to word from FinCEN regarding the new enforcement dates and other announcements.
The Corporate Transparency Act halt gives leeway for companies to take proactive steps to avoid last-minute rushes when the deadlines are reinstated.
What Are the Potential Consequences of Non-Compliance?
Once the Corporate Transparency Act halt is lifted, the penalties for non-compliance could be very serious, including but not limited to:
- Fines: The civil penalties can be up to five hundred dollars per day for each day the violation continues.
- Criminal Charges: In severe cases, businesses may be held criminally liable for fines and possible imprisonment on wilful violations.
Businesses that fail to file or who submit inaccurate information will be held accountable, so it pays to be prepared.
Conclusion
The Corporate Transparency Act halt gives a temporary breather for businesses in Florida, which must not be taken for complacency. The date of BOI reporting might be moved, but all requirements remain the same. Through awareness, information collection, and preparation for compliance now, Florida companies can ensure their due compliance once the CTA is back in force.