By Andi Anderson
Farmers and small businesses received temporary relief from reporting requirements under the Corporate Transparency Act (CTA), following a U.S. Court of Appeals decision to delay the Beneficial Ownership Information (BOI) filing requirement. Originally set to take effect on January 1, 2025, the mandate is now postponed indefinitely pending further court proceedings.
The CTA, enacted in 2021, aims to combat money laundering and organized crime by requiring small businesses to disclose their beneficial owners to the Treasury Department's Financial Crimes Enforcement Network (FinCEN).
The BOI requirement applies to businesses registered as corporations, limited partnerships, or LLCs, with fewer than 20 employees and under $5 million in cash receipts.
While most farms operate as sole proprietorships and are exempt, approximately 230,000 farms classified as state-registered businesses may still need to comply. These farms represent 12% of all operations and manage 33% of total farmland, according to the 2022 Census of Agriculture.
The American Farm Bureau Federation (AFBF) highlighted the challenges farmers face due to limited guidance and communication from the government. AFBF President Zippy Duvall stated, “The latest court decision to postpone the filing requirement is the right thing to do, but the legal back and forth created a stressful holiday season for many farm families.”
Beyond farms, rural businesses such as feed stores and grain elevators may also fall under the BOI filing requirement. Non-compliance could lead to penalties, including fines up to $10,000, civil charges of $591 per day, and potential felony charges.
The temporary reprieve offers farmers and small businesses much-needed relief while awaiting further clarity on compliance expectations. However, the potential long-term impact of these requirements on the agriculture industry and supply chains remains a concern.
Photo Credit: gettyimages-zoran-zeremski
Categories: Indiana, Government & Policy