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Treasury may fine small businesses up to $10,000 if they don’t file this report

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Treasury Secretary Janet Yellen following a tour of the Financial Crimes Enforcement Network (FinCEN) in Vienna, Virginia, on Jan. 8, 2024.

Valerie Plesch/Bloomberg via Getty Images

Small businesses and their owners could face penalties of $10,000 or more if they don’t comply with a new U.S. Treasury Department reporting requirement by year’s end — and evidence suggests many haven’t yet complied.

The Corporate Transparency Act, passed in 2021, created the requirement. The law aims to curb illicit finance by asking many businesses operating in the U.S. to report beneficial ownership information to the Treasury’s Financial Crimes Enforcement Network, also known as FinCEN.

Many businesses have a Jan. 1, 2025 deadline to submit an initial BOI report.

This applies to about 32.6 million businesses, including certain corporations, limited liability companies and others, according to federal estimates.

The Treasury Department did not respond to CNBC’s request for comment on the number of BOI reports that had been filed to date.

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The data helps identify the people who directly or indirectly own or control a company, making it “harder for bad actors to hide or benefit from their ill-gotten gains through shell companies or other opaque ownership structures,” according to FinCEN.

“Corporate anonymity enables money laundering, drug trafficking, terrorism and corruption,” Treasury Secretary Janet Yellen said in a January announcement of the BOI portal launch.

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Here’s the kicker: Businesses and owners that don’t file may face civil penalties of up to $591 a day, for each day their violation continues, according to FinCEN. (The sum is adjusted for inflation.) Additionally, they can face up to $10,000 in criminal fines and up to two years in prison.

“To a small business, suddenly you’re staring at a fine that could sink your business,” said Charlie Fitzgerald III, a certified financial planner based in Orlando, Florida, and a founding member of Moisand Fitzgerald Tamayo.

The federal government had received about 9.5 million filings as of Dec. 1, according to statistics FinCEN provided to the office of Rep. French Hill, R-Arkansas, who has called for the repeal the Corporate Transparency Act. Hill’s office shared the data with CNBC.

That figure is about 30% of the estimated total.

FinCEN was receiving a volume of about 1 million new reports per week as of early December, Hill’s office said.

Many businesses may not be aware

Nitat Termmee | Moment | Getty Images

A “beneficial owner” is a person who owns at least 25% of a company’s ownership interests or has “substantial control” of the entity.

Businesses must report information about their beneficial owners, like name, birth date, address and information from an ID such as a driver’s license or passport, in addition to other data.

Companies that existed prior to 2024 must report by Jan. 1, 2025. Those created in 2024 have 90 calendar days to file from their effective date of formation or registration; those created in 2025 or later have 30 days.

Corporate anonymity enables money laundering, drug trafficking, terrorism, and corruption.

Janet Yellen

U.S. Treasury Secretary

There are multiple exceptions to the requirement: For example, those with more than $5 million in gross sales and more than 20 full-time employees may not need to file a report.

Many exempt businesses — like large companies, banks, credit unions, tax-exempt entities and public utilities — already furnish similar data.

Brian Nelson, under secretary for terrorism and financial intelligence for the Treasury Department, said in an interview at the Hudson Institute earlier this year that the agency was “on a full court press” to spread awareness about the BOI registry, which opened Jan. 1, 2024.

But it seems many business owners either aren’t complying with or aware of the requirement, despite outreach efforts.

The scope of national compliance is “bleak,” the S-Corporation Association of America, a business trade group, said in early October.

The “vast majority” of businesses hadn’t yet filed a report, “meaning millions of small business owners and their employees will become de facto felons come that start of 2025,” it said.

Enforcement is up in the air

Bevan Goldswain | E+ | Getty Images

However, the situation isn’t quite that grim, others said.

For one, a federal court in Texas on Dec. 3 temporarily blocked the Treasury Department from enforcing the BOI reporting rules, meaning the agency can’t impose penalties while the court conducts a more thorough review of the rule’s constitutionality.

“Businesses should still be filing their information,” said Erica Hanichak, government affairs director at the Financial Accountability and Corporate Transparency Coalition. “The deadline itself hasn’t changed. It just changes enforcement of the law.”

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The government is expected to appeal, and enforcement “could resume” if the injunction is reversed, wrote attorneys at the law firm Fredrikson.

Additionally, Treasury said it would only impose penalties on a person (or business) who “willfully violates” BOI reporting.

The agency isn’t out for “gotcha enforcement,” Hanichak said.

“FinCEN understands this is a new requirement,” it said in an FAQ. “If you correct a mistake or omission within 90 days of the deadline for the original report, you may avoid being penalized. However, you could face civil and criminal penalties if you disregard your beneficial ownership information reporting obligations.”

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Student loan changes likely coming under Trump

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US President Donald Trump speaks to reporters while in flight on Air Force One, en route to Joint Base Andrews on April 6, 2025. 

Mandel Ngan | Afp | Getty Images

The Trump administration recently announced that it would begin a process of overhauling the country’s $1.6 trillion federal student loan system.

The potential changes could impact how millions of borrowers repay their debt, and who qualifies for loan forgiveness.

“Not only will this rulemaking serve as an opportunity to identify and cut unnecessary red tape, but it will allow key stakeholders to offer suggestions to streamline and improve federal student aid programs,” said Acting Under Secretary James Bergeron in a statement on April 3.

Around 42 million Americans hold federal student loans.

Here are three changes likely to come out of the reforms, experts say.

1. SAVE plan won’t survive

Former President Joe Biden rolled out the SAVE plan in the summer of 2023, describing it as “the most affordable student loan plan ever.” Around 8 million borrowers signed up for the new income-driven repayment, or IDR, plan, the Biden administration said in 2024.

The plan has been in limbo since last year, and in February a U.S. appeals court blocked SAVE in February. The 8th U.S. Circuit Court of Appeals sided with the seven Republican-led states that filed a lawsuit against SAVE, arguing that Biden was trying to find a roundabout way to forgive student debt after the Supreme Court struck down his sweeping loan cancellation plan in June 2023.

SAVE came with two key provisions that the legal challenges targeted: It had lower monthly payments than any other federal student loan repayment plan, and it led to quicker debt erasure for those with small balances.

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The Trump administration is unlikely to continue to defend the plan in court, or to revise it in its regulations, experts say.

“It’s difficult to see any scenario where SAVE will survive,” said Scott Buchanan, executive director of the Student Loan Servicing Alliance, a trade group for federal student loan servicers.

For now, many borrowers who signed up for SAVE remain in an interest-free forbearance. That reprieve will likely end soon, forcing people to switch into another plan.

2. End to loan forgiveness under other plans

The Trump administration recently revised some of the U.S. Department of Education’s other income-driven repayment plans for federal student loan borrowers, saying that the changes were necessary to comply with the recent court order over SAVE.

Historically, at least, IDR plans limit borrowers’ monthly payments to a share of their discretionary income and cancel any remaining debt after a certain period, typically 20 years or 25 years. 

The IDR plans now open are: Income-Based Repayment, Pay As You Earn and Income-Contingent Repayment, according a recent Education Department press release.

As a result of Trump administration’s revisions, two of those plans — PAYE and ICR — no longer conclude in automatic loan forgiveness after 20 or 25 years, Buchanan said, noting that the courts have questioned the legality of that relief along with SAVE.

The Trump administration, through its changes to the student loan system, is likely to make at least some of those temporary changes permanent, said higher education expert Mark Kantrowitz.

Still, if a borrower enrolled in ICR or PAYE switches to IBR, their previous payments made under the other plans will count toward loan forgiveness under IBR, as long as they meet the plan’s other requirements, Kantrowitz said. Some borrowers may opt to take that strategy if they have a lower monthly bill under ICR or PAYE than they would on IBR.

3. Narrowed eligibility for PSLF

President Donald Trump signed an executive order in March that aims to limit eligibility for the popular Public Service Loan Forgiveness program.

PSLF, which President George W. Bush signed into law in 2007, allows many not-for-profit and government employees to have their federal student loans canceled after 10 years of payments.

According to Trump’s executive order, borrowers employed by organizations that do work involving “illegal immigration, human smuggling, child trafficking, pervasive damage to public property and disruption of the public order” will “not be eligible for public service loan forgiveness.”

For now, the language in the president’s order was fairly vague. Nor were many details given in the latest announcement about reforming the student loan system, which said the Trump administration is looking for ways to “improve” PSLF.

As a result, it remains unclear exactly which organizations will no longer be considered a qualifying employer under PSLF, experts said.

However, in his first few months in office, Trump’s executive orders have targeted immigrants, transgender and nonbinary people and those who work to increase diversity across the private and public sector. Many nonprofits work in these spaces, providing legal support or doing advocacy and education work.

Changes to PSLF can’t be retroactive, consumer advocates say. That means that if you are currently working for or previously worked for an organization that the Trump administration later excludes from the program, you’ll still get credit for that time, at least up until the changes go into effect.

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Social Security updates anti-fraud measures for benefit claims

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A sign for the U.S. Social Security Administration is seen outside its headquarters in Woodlawn, Md., on Thursday, March 20, 2025.

Tom Williams | Cq-roll Call, Inc. | Getty Images

New anti-fraud protections are slated to go into effect on Monday at the Social Security Administration.

Ahead of the new policy, an agency spokesperson confirmed on Wednesday that all claim types can still be completed over the telephone, including retirement, survivor and spousal or children’s benefits. Previously, the SSA said those applicants would need to visit an agency office in person for identity proofing.

Individuals making other benefit claims — including for Social Security disability insurance, Medicare and Supplemental Security Income — can also complete their claims entirely over the telephone, which is in line with the agency’s previous guidance, according to the spokesperson.

The Social Security Administration’s update did not mention changes to direct deposit information, which it had previously said would now require in-office visits.

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The agency’s new anti-fraud efforts come as new leadership under the Trump administration’s so-called Department of Government Efficiency is broadly seeking to curb waste, fraud and abuse across federal government agencies.

The SSA is implementing the new anti-fraud procedures, including stricter identity verification, as the agency faces website outages and long wait times on its 800 number, potentially forcing more people to visit offices for assistance.

Social Security experts and advocates have raised concerns that the new policies may make accessing benefits more difficult for vulnerable populations, particularly seniors and people with disabilities.

However, the Social Security Administration’s update is a positive development, said Bill Sweeney, senior vice president of government affairs at AARP. He did add that it would be more ideal if the policy and timeline were reconsidered for better outcomes.

“This seems like a pretty good and encouraging signal that they’re listening to folks, that they’re that they’re open to pivoting and reconsidering how to roll these things out and looking at new ideas for how to implement it,” Sweeney said.

Some beneficiaries will still need to visit offices

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Online applications may be difficult for many seniors and individuals with disabilities, who may lack access to the necessary resources or know how to navigate the processes, according to the Center on Budget and Policy Priorities, a nonpartisan research and policy institute.

More than 10% of seniors in 35 states would need to travel more than 45 miles to get to the closest Social Security office, according to a new analysis from the Center on Budget and Policy Priorities.

About 6 million seniors don’t drive, while almost 8 million older Americans have a medical condition or disability that makes it difficult for them to travel, according to the research from Center on Budget and Policy Priorities.

Many beneficiaries already face obstacles getting through to the Social Security’s phone lines to make an in-person appointment and then need to drive to a field office, said Kathleen Romig, director of Social Security and disability policy at the Center on Budget and Policy Priorities. Generally, individuals need to call for an appointment, though the agency does urge beneficiaries to first try seeking help online.

‘Fear and concern among many older Americans’

Both experts and advocates take issue with the tight timeline under which the policy changes are being implemented.

“If you’re asking seniors and other SSA customers to do something different, you need to provide enough time for them to understand what it is they need to do,” Romig said.

The AARP sent a letter on Monday to Social Security Administration acting commissioner Lee Dudek urging the agency to “halt changes to phone services,” which will “only exacerbate the ongoing customer service crisis,” wrote Nancy LeaMond, chief advocacy and engagement officer.

Instead, the new policy changes should be done more deliberately, with public input, a clear communication strategy and reasonable timeline, the AARP explained in the letter.

The changes set to go into effect on Monday come as Social Security’s website has recently repeatedly crashed, phone service hold times have increased and in some cases disconnected callers, while field offices also have long in-person waits, LeaMond said in the letter.

“This chaotic environment is fueling fear and concern among many older Americans,” LeaMond wrote.

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How to check eligibility to claim the $1,400 IRS stimulus check

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The federal tax deadline is less than one week away — and there’s still time to collect a pandemic-era IRS stimulus check. It’s your final chance to do so.

If you’re unsure if you received the money, there’s a simple way to check via your IRS account online, tax experts say.

The 2021 stimulus payments were worth up to $1,400 per individual, or $2,800 per married couple. A family of four could receive up to $5,600 with two eligible dependents.

Filers who never received the funds could claim the recovery rebate credit on their 2021 federal return. The last chance for that credit is the 2024 tax deadline on April 15, according to the IRS.

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You’re eligible for the full recovery rebate credit with up to $75,000 in adjusted gross income as a single filer or $150,000 for married couples filing jointly for 2021.

The phaseout begins with earnings above that and eligibility falls to zero once adjusted gross income reaches $80,000 for single filers or $160,000 for married couples filing together.

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The IRS in December unveiled plans to send “special payments” to 1 million taxpayers who didn’t claim the 2021 recovery rebate credit on tax returns for that year.  

Most payments should have arrived via direct deposit or mailed paper check by late January 2025, according to the agency. 

You can create a login for your IRS online account to check the status of your economic impact payments, including the 2021 stimulus check.

“That’s the best place to look,” said Tommy Lucas, a certified financial planner and enrolled agent at Moisand Fitzgerald Tamayo in Orlando, Florida.

After logging into your account, you can find stimulus check information in the “tax records” section under the “records and status” toolbar. 

You can also check the “tax records” section to see if you filed a return for 2021. While some taxpayers don’t earn enough to have a filing requirement, you must submit your 2021 return to claim the recovery rebate credit for your stimulus payment, Lucas explained.

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File your 2021 return if ‘there’s any doubt’

In some cases, online accounts show the IRS issued stimulus checks, but filers say they never received the money, said Syracuse University law professor Robert Nassau, director of the school’s low-income tax clinic.

“If there’s any doubt” about your payment, it’s better to file your 2021 return and claim the recovery rebate credit before April 15, he said. Otherwise, you could miss the deadline and lose your chance to collect the money, Nassau added. 

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