FinCEN Clarifies That Dissolved Entities Are Subject to CTA Reporting Obligations | Proskauer – Regulation & Compliance

FinCEN Clarifies That Dissolved Entities Are Subject to CTA Reporting Obligations | Proskauer – Regulation & Compliance

On July 8, 2024, the U.S. Treasury Department’s Financial Crimes Enforcement Network (“FinCEN”) issued additional FAQs(1) regarding beneficial ownership reporting requirements for dissolved entities. The Corporate Transparency Act requires reporting companies to report information about their beneficial owners and applicant companies to FinCEN (a “BOI Report”) and is intended to help prevent and combat money laundering, terrorist financing, tax evasion, and other illicit activities. The Beneficial Ownership Reporting Rule (the “BOI Rule”), promulgated by FinCEN in September 2022, establishes the types of entities that are reporting companies and how beneficial owners and applicant companies are determined, as well as the information that must be reported about these entities and persons.

Any U.S. entity created by filing with a Secretary of State or similar office or a tribal jurisdiction, or an entity organized under the laws of a foreign country and registered to do business in a state or tribal jurisdiction, existing on or after January 1, 2024, is subject to the BOI Rule. The new FAQs clarify that the dissolution of a reporting company before the date its initial BOI report is due does not relieve the entity of its obligations under the BOI Rule. An entity is not required to file a BOI Report if it was formally and irrevocably dissolved before January 1, 2024, or if an applicable exemption exists. A reporting company in existence as of January 1, 2024, must file a BOI Report even if it is formally dissolved before the January 1, 2025, filing deadline. Similarly, a reporting company incorporated or registered on or after January 1, 2024, but dissolved before the date its initial BOI Report is due, must file a BOI Report within the applicable deadline (90 days from formation or registration for reporting companies incorporated or registered in 2024, and 30 days from formation or registration for reporting companies incorporated or registered on or after January 1, 2025). If a reporting company ceases to exist after filing its BOI Report, it is not required to file an amended report reflecting the dissolution.


(1) FAQs published by FinCEN and updated periodically are available at https://www.fincen.gov/boi-faqs.

(See source.)