The Current State of BOI: Awaiting FinCEN's Move

As we approach the March 21st deadline, the BOI reporting landscape remains in an unusual state of limbo:

• FinCEN is expected to release an official update before the March 21st deadline

• The Department of Treasury continues to maintain they will not enforce any fines or penalties against domestic entities

• Yet the underlying law technically remains in effect, creating significant confusion for businesses

This creates an unprecedented regulatory gray area where compliance requirements exist on paper but enforcement has been publicly suspended.

The Internal Power Struggle Continues

What's particularly notable about this situation is the evident conflict between various government departments:

• DOGE (Department of Government Efficiency) has effectively established a "stranglehold" on the situation through their coordination with the Department of Treasury

• Meanwhile, the Department of Justice continues pushing for BOI implementation to proceed as originally planned

• This creates a direct conflict between Executive Branch departments with different priorities

Court Cases Proceed Despite Enforcement Pause

Despite the Treasury's non-enforcement stance, several key legal challenges continue moving forward:

• The Samantha Smith case

  • Current Status: On February 18, 2025, the district court granted the DOJ’s motion to stay this injunction pending appeal, theoretically reinstating the BOI rule. However, the Financial Crimes Enforcement Network (FinCEN) extended the reporting deadline to March 21, 2025, for entities with expired deadlines, acknowledging compliance challenges amid ongoing litigation. The appeal is now before the Fifth Circuit, alongside the Texas Top Cop Shop case, though no specific hearing date has been widely reported yet for this case alone.

• The Texas Top Cop Shop case

  • Current Status: The Department of Justice (DOJ) appealed the injunction to the Fifth Circuit Court of Appeals. The appeal has seen significant developments:

    • On December 23, 2024, a Fifth Circuit motions panel briefly lifted the injunction, reinstating BOI requirements.

    • On December 26, 2024, a merits panel vacated that decision, reinstating the nationwide injunction.

    • On January 23, 2025, the U.S. Supreme Court granted a stay of this injunction, but enforcement remains paused due to a separate case (see below). The Fifth Circuit has expedited the appeal, with oral arguments scheduled for March 25, 2025.

Both cases are under active consideration in the Fifth Circuit, with the Texas Top Cop Shop appeal set for March 25, 2025. The outcomes could either reinstate mandatory reporting, uphold the injunctions, or lead to further Supreme Court review. These court proceedings could ultimately have significant implications for the future of BOI reporting, regardless of the current enforcement pause.

What This Means For Businesses

For entities potentially subject to BOI reporting requirements:

• The technical deadline of March 21st still exists

• No penalties or fines are expected to be enforced for domestic entities

• However, the legal requirement technically remains in place

• Foreign reporting companies may still face enforcement

What Comes Next?

We're closely monitoring several key developments:

1. FinCEN's promised an update prior to March 21st

2. Any formal rulemaking changes to codify the enforcement pause

3. Outcomes from ongoing litigation

4. Potential Congressional action to address the situation legislatively

The Bottom Line

This regulatory standoff creates an unusual situation in which businesses must balance technical compliance requirements and public statements about non-enforcement.

Bridge to BOI will continue providing updates as this situation evolves, particularly after FinCEN's expected announcement.

One thing remains clear: the BOI saga demonstrates how quickly regulatory landscapes can shift in today's political environment.