Confusion for Farmers as Corporate Transparency Act Reporting Deadline Put on Hold Again
By now, you’ve likely heard of the Corporate Transparency Act. If you fail to comply, you could face up to two years in prison and a fine of up to $10,000! However, the reporting deadline has once again been put on hold.
The U.S. Treasury Department is requiring small business owners—including over 230,000 farmers and ranchers—to file a new report called the “Beneficial Ownership Information” report—that’s with the Treasury Department’s Financial Crimes Enforcement Network, or FinCEN for short.
Dustin Sherer, Director of Government Affairs with the American Farm Bureau Federation (AFBF), says the measure was initially set up to fight money fraud and identify companies that are funding terrorist activities.
“It’s information that the federal government believes will help them identify shell companies that are being used to launder money. Because they couldn’t come up with a good definition of a shell company, they put out a definition that essentially qualifies every small business in America as a potential shell company,” according to Sherer.
In late November, a federal judge in Texas issued a nationwide injunction stopping the government from enforcing the act. But, just days before Christmas, that injunction was overturned by an Appeals Court. To make matters worse, the original deadline for filing the report was Jan. 1st.
“Shortly thereafter, the federal government—FinCEN—issued a statement saying, anybody who had that deadline, we will extend the filing deadline to January 13,” says Sherer.
The day after Christmas, the Appeals Court decided to reverse their previous decision—which once again reverses that order until arguments can be heard, delaying the reporting requirement indefinitely.
Sherer says you should still consult with a tax and law professional right away just in case to avoid facing felony charges if the reporting deadline delay is lifted once again.
“You should check with a lawyer or your CPA, but if you had to file any type of document with the state government in order to create your business entity, then you are very likely required to file your beneficial ownership information, and you should file to be safe,” says Sherer.
On Saturday, Kent Baucus, Executive Director of Government Affairs with the National Cattlemen’s Beef Association (NCBA), issued a statement saying, “NCBA is [urging] Congress to pass legislation that will permanently protect cattle farmers and ranchers from this burdensome mandate.”
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