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September 15, 2024

Minute Read


This month’s small business updates includes the following: 

  • Upcoming deadlines for filing your Business Ownership Information (BOI) reports with the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN)
  • Update on the Employee Retention Credit (ERC) and the new IRS payback program
small business update


BOI Reporting Deadline Is Closing In

The clock continues to tick. Here are the upcoming deadlines for filing your Business Ownership Information (BOI) reports with the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN).

Deadlines

If your business existed as of January 1, 2024, you must file your BOI report by January 1, 2025.

If you created your business in 2024, you have 90 days from the date of filing with your state’s Secretary of State to submit your BOI report.

Entities Required to File

All limited liability companies (LLCs) and corporations must file.

If you own multiple LLCs, each requires a separate BOI report

Penalties for Non-compliance

Failure to file on time can result in significant penalties, including fines of $591 per day, a potential $10,000 criminal penalty, and up to two years in prison.

Recent Updates from FinCEN

Companies that ceased to exist before January 1, 2024, are not required to file a BOI report if they completed the dissolution process before that date.

Companies created or still existing on or after January 1, 2024, must file a BOI report, even if they ceased operations before their filing deadline.

Special Considerations for Disregarded Entities

Disregarded entities, for U.S. tax purposes, must also file a BOI report using a valid taxpayer identification number (TIN), such as an EIN, SSN, or ITIN.

Employee Retention Credit (ERC) Update

Here’s a recent update on the Employee Retention Credit (ERC) and the new IRS payback program.

New IRS ERC Payback Program for 2021 Claims

The IRS introduced a second ERC Voluntary Disclosure Program for 2021 claims. Under this program, you can say, “I didn’t deserve the ERC, so I’ll repay 85 percent of my claimed ERC and retain 15 percent tax-free.”

The program is available only for ERC claims from 2021, and there are specific eligibility requirements.

If you claimed the ERC using a third-party payer, the third party must apply on your behalf

Eligibility Criteria for Payback

You must not be under criminal investigation or an IRS employment tax examination for 2021 returns. The IRS must not have notified you of ERC recapture or received third-party information about your non-compliance.

Steps to Participate

You need to complete IRS Form 15434 and upload it online by November 22, 2024. After submitting the form, you will receive a closing agreement, which you must sign and return within 10 days.

No Appeals

If the IRS denies your request to participate in the payback program, you have no opportunity for judicial review or administrative appeal.

Legislative Changes Pending

H.R. 7024, currently pending in the Senate, could introduce stricter penalties for ERC promoters and extend the statute of limitations for examining ERC claims to six years.

IRS ERC Processing

The IRS is currently processing a backlog of 1.4 million ERC claims. While some payments have begun, and some have been denied, many claims are still under review. It’s likely your wait for your ERC refund will continue.

Contact your tax and financial advisors to determine the best moves for your situation.


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