In our October 9, 2024 blog post, we discussed the fact that the Supreme Court ruling (Connelly v. United States) about life insurance coverage on business partners had added complexity for our Geyer Law clients who are owners of closely held businesses. Now another court ruling, this one by the Fifth Circuit Court of Appeals, is likely to affect our many Geyer Law business owner clients…
Back in 2021, the Corporate Transparency Act was passed, declaring that companies needed to file a document called a Beneficial Ownership Report. The report was to be filed with the federal government’s Financial Crimes Enforcement Network, identifying all individuals who own or control the company. The deadline was supposed to be January 1, 2025, but after the legality of the ruling was challenged, there was a nationwide injunction or hold on the filing requirement. That injunction has been lifted and the BOI filing is once again mandated. The new deadline, for companies formed before January 1, 2024 is now January 13 of this year (five days from today!)
While, as Indiana estate and business planning attorneys, we offer no tax advice, instead working together with our clients’ tax and financial planning advisors, business ownership interests constitute an important element in our clients’ estate planning decisions. As Aimee Hall of software provider Wolters Kluwer points out, the Corporate Transparency Act’s Beneficial Ownership Information reporting requirement “has left many small and mid-sized businesses with more questions than answers.”
The Financial Crimes Enforcement Network (FinCEN) explains that the information by business owners will be used only for authorized purposes related to national security, intelligence, and law enforcement”.
While no one goes into business anticipating bad outcomes, at Geyer Law, we know it’s important to remind clients that, in fact, bad things can and do happen to even very good – and even to very skilled – business operators, including death, disability, incapacity, loss of a professional license, or departure of a key employee. Proper advance planning can at least blunt the terrible effects of bad things that happen to even the best of businesses.
For many of our Geyer Law business owner clients, the decision by the Fifth Circuit Court of Appeals has put the Beneficial Ownership Report back on the DO NOW list!
– by Cara Chittenden, Attorney with Rebecca W Geyer & Associates
