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Glenn Fox

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Glenn G. Fox is a partner of Baker McKenzie's Wealth Management and Tax Practice Groups in New York and a member of the firm’s Global Tax Wealth Management Steering Committee. He is a domestic and international tax, estate planning, and tax-exempt (charitable) organizations lawyer with vast experience working with closely held businesses, families and charitable organizations from the US and overseas. Glenn is a member of the American College of Trust and Estate Counsel and of the Society of Trust and Estate Practitioners and has been recognized for fourteen consecutive years (2007-2020) as a "New York Super Lawyer" by the New York Times.

Over the past week there have been two significant announcements by US Financial Crimes Enforcement Network and the US Department of the Treasury with respect to the filing of beneficial ownership information (BOI) reports under the Corporate Transparency Act (CTA). Based on these announcements, foreign reporting companies should technically continue complying with the BOI requirements, though there will be no consequences for failing to do so until new regulations are issued. As to domestic reporting companies, there should not be any enforcement of the CTA against such companies or consequences if such companies fail to file BOI reports.

Over the past week there have been two significant announcements by US Financial Crimes Enforcement Network and the US Department of the Treasury with respect to the filing of beneficial ownership information reports under the Corporate Transparency Act. Based on these announcements, foreign reporting companies should technically continue complying with the BOI requirements, though there will be no consequences for failing to do so until new regulations are issued. As to domestic reporting companies, there should not be any enforcement of the CTA against such companies or consequences if such companies fail to file BOI reports.

As of 18 February 2025, the US Treasury’s Financial Crimes Enforcement Network is once again authorized to enforce the beneficial owner interest (BOI) reporting provisions of the Corporate Transparency Act . Therefore, beneficial ownership interest report filing by Reporting Companies is once again mandatory with an extended deadline of March 21, 2025, for many companies.

On 23 January 2025, the US Supreme Court granted the US government’s application to end the nationwide preliminary injunction against enforcement of the Corporate Transparency Act (CTA) issued by the District Court in Top Cop Shop on 3 December 2024. This injunction is currently on appeal with the Fifth Circuit. However, a separate nationwide order that also stayed the CTA beneficial owner reporting deadline remains in place. This order was issued by a different federal judge in Smith v. US on 7 January 2025.

The Corporate Transparency Act requires “reporting companies” to file “beneficial owner” information and “company applicants” with the Financial Crimes Enforcement Network (FinCEN) as early as 1 January 2025. In a “last minute” 3 December 2024 decision, the US District Court for the Eastern District of Texas in Top Cop Shop, Inc., et al. v. Garland, issued an order temporarily enjoining the US government from enforcing the CTA and CTA regulations

The IRS recently announced changes to its Form 14457, “Voluntary Disclosure Practice Preclearance and Application,” which allows taxpayers to apply to the IRS in an attempt to limit criminal exposure by disclosing past noncompliance and paying past taxes, interest and penalties. The new form includes several revisions that demonstrate a stricter approach towards taxpayers wanting to voluntarily disclose past tax-related misconduct, including: an admission of willfulness, a more detailed narrative requirement, a shorter time to prepare documents, and mandatory full payment. Taxpayers should consult with counsel to examine any increased risks associated with filing the revised form.

On 1 March 2024, New York Governor Hochul signed into law the amended LLC Transparency Act (“Act”). Enacted on 23 December 2023, the Act underwent significant revisions as a result of the agreement between the Governor and the legislators. The Act requires that all limited liability companies (LLCs) formed under the New York Limited Liability Company Act (“LLC Act”) or seeking authorization to do (or doing) business in New York State disclose information about certain of their beneficial owners, or submit a statement that the entity qualifies for an exemption from this requirement. All LLCs in existence prior to 1 January 2026 must comply with the Act before 1 January 2027.

Two recent tax controversies demonstrate the authority of US courts in situations where a taxpayer’s assets are held in a country different than the taxpayer’s country of residence. In United States v. Kelly, a US person held assets in a Swiss bank account and failed to file a Foreign Bank Account Report (FBAR), and the court ordered repatriation of those assets to the United States. In Puri v. United States, an Indian taxpayer held assets in a US bank account, and the United States Supreme Court denied certiorari, finalizing the district court’s order that denied taxpayer’s motion to quash an administrative third-party summons issued by the IRS.

With the new year comes the 1 January 2024 effective date of the Corporate Transparency Act, which will require approximately 32.6 million US entities to report beneficial ownership information (BOI) to the Treasury’s Financial Crimes Enforcement Network (FinCEN). On 28 September 2023, FinCEN published proposed regulations modifying the BOI Reporting Requirements, which are found in the CTA’s implementing regulations.