Read more about the article Updates on the Corporate Transparency Act: Our Commitment to Keeping You Informed

Updates on the Corporate Transparency Act: Our Commitment to Keeping You Informed

At Sims & Campbell, our experienced estate planning attorneys are committed to providing our clients with the latest updates on legal developments that could impact them. To ensure you have the most accurate and timely information, we will now be posting all news regarding the Corporate Transparency Act (CTA) right here on our blog.

On March 2, 2025, the U.S. Treasury Department announced a suspension of the March 21, 2025, deadline for filing under the Corporate Transparency Act (CTA) for both domestic companies and U.S. citizens. Additionally, the Treasury announced it will not enforce any penalties or fines. This decision follows a series of legal and regulatory developments regarding the CTA and its enforcement. For more details, see below:

The Corporate Transparency Act (CTA) is a U.S. law that was enacted as part of the National Defense Authorization Act for Fiscal Year 2021. The purpose of the CTA is to enhance transparency in the ownership of companies and to combat illicit activities like money laundering, tax evasion, and terrorist financing by making it harder for criminals to hide behind anonymous shell companies. The CTA requires certain businesses, including corporations, limited liability companies (LLCs), and similar entities, to disclose information about their beneficial owners. A beneficial owner is an individual who, directly or indirectly, owns or controls at least 25% of a company or who exercises substantial control over it.

The CTA has far-reaching implications for both domestic and foreign companies, and understanding its requirements is essential for compliance. With that in mind, we’ll keep you up to date on any changes, deadlines, and new regulations that emerge. Read on for the latest news on the Corporate Transparency Act.

Here are the key takeaways:

  1. Suspension of the Filing Deadline: The Treasury has suspended the filing requirement under the CTA for domestic companies and U.S. citizens. The March 21, 2025, deadline is no longer applicable at this time.
  2. No Penalties or Fines At This Time: The Treasury Department announced it will not enforce any penalties or fines associated with the BOI reporting rule under the existing regulatory deadlines.
  3. Proposed Rulemaking to Narrow Scope: The Treasury is preparing a proposed rulemaking that could narrow the scope of the CTA’s reporting requirements to focus exclusively on foreign reporting companies. These are entities formed under foreign law but that have registered to do business in the U.S. by filing a document with a secretary of state or similar office.
  4. Legal Uncertainty: The proposed narrowing of the rule is inconsistent with the original text of the CTA and could be subject to legal challenges. While it is unclear who might challenge these changes, the possibility of legal action remains.
  5. Ongoing Legal Challenges: The CTA, which was passed during the first Trump Administration and implemented under the Biden Administration, has faced numerous legal challenges across the country. These challenges are still ongoing, with many cases pending before appellate courts.
  6. Impact on Information Already Filed: The Treasury has not clarified what will happen to the information already submitted under the CTA. Additionally, with the suspension of the enforcement of the filing deadline, domestic companies and U.S. citizens are no longer required to keep their submitted information up to date.

Stay tuned to our blog for the latest information on the Corporate Transparency Act and other legal matters that may affect you and your business. For additional questions or concerns, please contact our office to schedule a confidential estate planning meeting with one of our attorneys.

Read more about the article How Divorce Affects an Estate Plan

How Divorce Affects an Estate Plan

Divorce changes not only a person’s financial and personal life but also the way their assets will be handled after death. Many people overlook the importance of updating estate planning documents after a divorce, which can result in unintended beneficiaries receiving inheritances or former spouses retaining control over critical financial and medical decisions. Taking the time to revise an estate plan ensures that assets are protected and aligned with post-divorce goals.

How Divorce Affects Your Estate Plan

Divorce changes personal and financial circumstances and how assets will be distributed after death. Many forget to update their estate plans, leaving former spouses as beneficiaries or decision-makers. Without revisions, an ex-spouse could inherit assets, manage finances, or make medical decisions in an emergency.

Key documents that need immediate attention include wills, trusts, powers of attorney and beneficiary designations on life insurance and retirement accounts. Updating these ensures that assets go to intended heirs and that financial and medical decisions remain in trusted hands.

Updating Wills and Trusts

A divorce does not automatically remove an ex-spouse from an estate plan. If a will or trust still names the former spouse as a primary beneficiary or executor, they may inherit assets or retain authority over the estate. Updating key documents includes:

  • Revising a will to name new beneficiaries and executors
  • Amending or revoking any revocable trusts that include the former spouse
  • Reviewing state laws, some jurisdictions automatically void spousal provisions upon divorce, while others do not

Failing to update these documents may lead to unnecessary legal battles or the distribution of assets against the person’s wishes.

Changing Beneficiary Designations

Many financial assets pass directly to named beneficiaries outside of a will, making beneficiary updates essential after divorce. Documents to review include:

  • Life insurance policies and retirement accounts, such as 401(k)s and IRAs
  • Payable-on-death (POD) and transfer-on-death (TOD) accounts
  • Jointly held assets or real estate with right of survivorship

If an ex-spouse remains listed as a beneficiary, they may still receive these assets, regardless of the divorce decree. Updating beneficiary designations ensures that assets go to the intended individuals.

Adjusting Powers of Attorney and Healthcare Directives

Divorce often necessitates appointing new individuals to manage financial and medical decisions in case of incapacity. Changes to consider include:

  • Naming a new power of attorney for financial matters
  • Revising a healthcare proxy to designate a trusted individual for medical decisions
  • Ensuring that living wills and advance directives reflect current wishes

Leaving a former spouse in control of these decisions can lead to unintended complications, particularly in medical emergencies.

Spousal Elective Share

Some states, such as Maryland, have a spousal elective share which allows a surviving spouse to claim a portion of the deceased spouse’s estate, even if they were excluded from the will. This is a protection for a surviving spouse who might otherwise be left with nothing due to the deceased spouse’s will or other estate planning documents. A spouse can waive the right to an elective share if they signed a valid pre-nuptial agreement or post-nuptial agreement giving up this right.

Secure Your Legacy with an Updated Estate Plan

Divorce requires more than financial separation—it demands a complete estate plan review to prevent unintended consequences. Ensuring that your will, trusts and powers of attorney reflect your current wishes is critical to protecting your assets and loved ones.

Our boutique law firm provides comprehensive estate planning services to help you update legal documents after divorce. Schedule a consultation today with one of our experienced estate planning attorneys to secure your financial future.

Key Takeaways

  • Wills and trusts must be updated after divorce: Failing to revise estate documents may result in an ex-spouse inheriting assets or serving as executor.
  • Beneficiary designations require careful review: Retirement accounts, life insurance and bank accounts should be updated to reflect new intentions.
  • Powers of attorney and healthcare directives should be revised: Naming a new agent ensures that a trusted individual handles financial and medical decisions.
  • State laws may impact estate plan changes: Some jurisdictions automatically revoke spousal provisions, while others require updating specific documents.
  • Proactive planning prevents legal disputes: Updating an estate plan immediately after divorce helps avoid unintended consequences and ensures that assets are distributed according to new wishes.

References: Investopedia (June 25, 2024) “Rewriting Your Will After Divorce” and Justia (September 2024) “Estate Planning After Divorce”

Read more about the article Where Should I Keep My Will?
Probate is the legal process of administering the estate of a deceased person, resolving any claims and ultimately distributing the deceased person's property under the declaration of the deceased’s Last Will & Testament. A probate court decides the legal validity of a testator's will and grants its approval by granting probate to the executors. Until such time as probate is granted and after any due taxes have been deducted, the assets and property forming the wealth of the estate, remains locked - out of the reach of any beneficiaries.

Where Should I Keep My Will?

A will is only useful if it can be found after death. If misplaced, locked away without access, or accidentally destroyed, the probate court may proceed as if no will exists, distributing assets according to state law rather than the decedent’s wishes. Proper storage balances security and accessibility, ensuring that the document is protected but readily available when needed.

Best Places to Store a Will.

In a Fireproof and Waterproof Safe at Home

A home safe provides security while allowing immediate family access when needed. It should be fireproof and waterproof and placed in a location known to the executor. If the safe requires a key or code, at least one trusted person should have access. Without access instructions, a locked safe can delay probate and require court intervention.

With the Probate Court (Where allowed)

Some states allow individuals to file their will with the local probate court for safekeeping. This ensures that the document is secure and legally recognized. However, this method requires updating the court file when revisions are made. If this step is overlooked, an outdated will may be used in probate.

Registered with The U.S. Will Registry

Registering your will with The U.S. Will Registry helps ensure your loved ones can locate it when needed. Even if you store a physical copy safely, family members may forget its location, misplace it, or accidentally discard it. By registering, you clearly record where your will is stored, preventing unnecessary stress and delays in settling your estate. The U.S. Will Registry also offers free online storage, giving you extra security and peace of mind.

With an Estate Planning Attorney

Some people choose to leave their will with the attorney who drafted it. Law firms typically store wills in fireproof safes, ensuring that the document is secure and intact. If the will’s validity is questioned, an attorney can verify its authenticity. However, this option is only effective if family members or the executor know which attorney holds the will and that the attorney is still in business.

Where Not to Store a Will

In a Bank Safe Deposit Box

While safe deposit boxes provide strong security, they can cause delays. Banks typically seal a box upon the owner’s death, preventing the executor from accessing the will without a court order. If choosing this option, the executor should be listed as a co-owner with access rights.

In an Unsecured Location

A will should not be stored in a desk drawer, filing cabinet, or with other household papers. These locations increase the risk of loss, accidental destruction, or intentional tampering. A digital copy is insufficient, as most states require the original, signed document for probate.

Ensuring the Will Can Be Found

Regardless of where the will is stored, the executor and at least one trusted person should know its location. Keeping instructions in a separate estate planning file and other critical documents ensures the will can be located and used immediately.

Key Takeaways

  • Proper storage prevents legal complications: The probate court may distribute assets according to state law if a will is lost or inaccessible.
  • An attorney’s office offers security and authentication: Keeping a will with an estate planning attorney protects it from loss and helps verify its validity.
  • A fireproof home safe balances security and access: A well-placed, fireproof safe ensures that the will is protected while remaining available to the executor.
  • Safe deposit boxes can cause probate delays: If an executor cannot access a safe deposit box, a court order may be required to retrieve the will.
  • Family members must know where the will is stored: Informing the executor and key family members of its location prevents confusion and unnecessary legal delays.

Contact us to schedule a complimentary initial call with one of our experienced estate planning attorneys.

Reference: The U.S. Will Registry (Oct. 24, 2024) “Where to Store Your Will to Ensure its Security”

Read more about the article Update Regarding Corporate Transparency Act and the Beneficial Ownership Information Reporting – December 27, 2024

Update Regarding Corporate Transparency Act and the Beneficial Ownership Information Reporting – December 27, 2024

We previously shared updates regarding the Corporate Transparency Act (“CTA”), most recently reporting that the injunction against enforcement of the CTA was overturned and deadlines for most filers were extended to January 13, 2024.

We have yet another change to report. Late December 26, 2024, a panel for the Fifth Circuit Court of Appeals reinstated the injunction until it can hear oral arguments from the parties and issue a ruling on the government’s appeal of the original injunction.

We anticipate a ruling and more updates in early January.  In the meantime, we continue recommend all parties required to file under the CTA should be prepared to file on short notice after the court’s ruling provides more clarity.

We will continue to monitor the situation and share updates as they become available.

Sims & Campbell, LLC- Annapolis and Towson Estate Planning Attorneys

Read more about the article Update Regarding Corporate Transparency Act and the Beneficial Ownership Information Reporting – December 26, 2024

Update Regarding Corporate Transparency Act and the Beneficial Ownership Information Reporting – December 26, 2024

  • Post category:CTA

We are following up on the latest developments regarding the Corporate Transparency Act (CTA) and its implications for beneficial ownership information (BOI) reporting. On December 23, 2024, a significant update came from the Fifth Circuit Court of Appeals, which granted a stay on a preliminary injunction that had previously suspended the CTA’s enforcement. This decision reinstates the obligation for reporting companies to submit beneficial ownership information to the Financial Crimes Enforcement Network (FinCEN). However, acknowledging the confusion caused by the temporary suspension, FinCEN has extended the filing deadlines to provide a grace period for compliance. Companies created or registered prior to January 1, 2024, now have until January 13, 2025, to file their initial reports, while those registered between December 3 and December 23, 2024, have an additional 21 days from their original deadline.

We will continue to monitor this development closely and provide updates as they become available. For clients concerned about the implications of this ruling on their business or estate planning, please feel free to contact us.

Sims & Campbell, LLC- Annapolis and Towson Estate Planning Attorneys

Read more about the article Update Regarding Corporate Transparency Act – Court REINSTATES Reporting Requirements – December 23, 2024

Update Regarding Corporate Transparency Act – Court REINSTATES Reporting Requirements – December 23, 2024

This afternoon (December 23, 2024), the United States Court of Appeals for the Fifth Circuit reinstated the enforceability of the Corporate Transparency Act (CTA) effective immediately. In Texas Top Cop Shop, Inc. v. Garland, a three-judge panel of the Fifth Circuit stayed a lower court’s nationwide preliminary injunction against the CTA, which was issued on December 3, 2024. This means that, among other obligations, the January 1, 2025, compliance deadline for reporting companies in existence as of January 1, 2024, is back in effect.

This situation is likely to rapidly evolve. It is entirely likely that in the coming days, the challengers in this case will seek further review from the Fifth Circuit or seek relief from the United States Supreme Court. Additionally, several other federal courts are actively considering challenges against the CTA. At the time of this writing the United States Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) has not publicly released any guidance based on today’s ruling.

We will continue to monitor this development closely and provide updates as they become available. For clients concerned about the implications of this ruling on their business or estate planning, please feel free to contact us.

Sims & Campbell, LLC- Annapolis and Towson Estate Planning Attorneys

Read more about the article Significant Ruling on Corporate Transparency Act Blocking Reporting Requirements Nationwide

Significant Ruling on Corporate Transparency Act Blocking Reporting Requirements Nationwide

A recent ruling by the U.S. District Court for the Eastern District of Texas has preliminarily blocked the nationwide enforcement of the Corporate Transparency Act (CTA). This decision impacts businesses nationwide, as the CTA aimed to require U.S. business entities to report stakeholder information to the Treasury Department to combat money laundering and other illicit activities through shell companies. The injunction was issued in response to a lawsuit by Texas Top Cop Shop Inc. and co-plaintiffs, arguing that the CTA oversteps Congress’s constitutional authority to regulate commerce, especially since it applies to entities regardless of their engagement in commercial activities. This ruling halts the implementation of these reporting requirements temporarily, pending further legal proceedings, which could have significant implications for estate planning and business privacy. As a result, individuals are no longer required to file but that may change in the future based on court decisions and agency regulations.

We will continue to monitor this development closely and provide updates as they become available. For clients concerned about the implications of this ruling on their business or estate planning, please feel free to contact us.

[For further reading on the CTA and its implications, see the article here: https://news.bloombergtax.com/daily-tax-report/corporate-transparency-act-blocked-nationwide-by-texas-court ]

Sims & Campbell, LLC- Annapolis and Towson Estate Planning Attorneys

 

Read more about the article Avoid Maryland Inheritance Tax With a Domestic Partnership – Annapolis and Towson Estate Planning
Save on Maryland Inheritance Tax if you are in a committed relationship.

Avoid Maryland Inheritance Tax With a Domestic Partnership – Annapolis and Towson Estate Planning

As of October 1, 2023, Maryland’s Senate Bill 792 introduced a significant legal framework for domestic partnerships, offering couples who choose not to marry a pathway to secure some of the same benefits as married spouses, such as saving on the Maryland Inheritance Tax at death. Awareness of this change in the law will help you make informed decisions about personal relationships, legal protections, and financial planning. Here is what you need to know about registering as domestic partners and the implications of not doing so.

To establish a legal domestic partnership, Maryland Code Estates and trusts Section 2-214 requires two individuals to be at least 18 years old, the sole domestic partner of the other, not married, and in a committed relationship with the other individual.

The process to register a domestic partnership has become more streamlined. Couples seeking to enter a domestic partnership must register their relationship with the Register of Wills in the county in which they are domiciled by filing a signed and notarized declaration form. They also need to pay the appropriate filing fee. Once registered, the relationship will be recognized in all counties regardless of where the partners passed away in Maryland.

Registering as a qualified domestic partnership acts as a legal safety net which guarantees certain benefits during estate administration in Maryland, such as:

  • Inheritance: Now, a surviving domestic partner inherits in the same manner as a surviving spouse if there is no will, potentially receiving the entire estate if there are no surviving descendants or sharing it equally with minor children of the deceased partner.  Without registration, a domestic partner is treated as a legal stranger in the absence of a will, receiving no automatic inheritance rights.
  • Tax Benefits: Assets inherited from a registered domestic partner are exempt from Maryland’s 10% inheritance tax.  Not registering means any inheritance could be subject to Maryland’s inheritance tax, significantly reducing the net inheritance for the surviving partner.
  • Priority as Personal Representative: Domestic partners have priority to serve as the personal representative of their deceased partner’s estate.  Without registration, there is no legal priority for serving as the personal representative of your partner’s estate, which could lead to third parties or family members taking control.
  • Family Allowance: A surviving registered domestic partner is entitled to a family allowance of $10,000 upon the death of their partner.

In contrast, should one choose not to register as a qualified domestic partnership, in addition to losing the foregoing benefits, they risk a loss of other rights and interests, such as:

  • Legal Complexity in Termination: While registered partnerships can be legally terminated, unregistered relationships might face more complex legal battles over property or support if they end, especially if there’s no cohabitation agreement.
  • Lifetime Protections: Registration provides clear legal protections in areas like hospital visitation, which might not be automatically recognized for unregistered partners.
  • Future Legal Disputes: Without formal registration, disputes over shared property, support, or rights could be more contentious and less predictable in court.
  • If for any reason a partner needs to terminate the qualified domestic partnership, the State of Maryland requires a signed and filed termination form. This termination will take effect six months from filing, unless the reason for termination was by marriage or death.

Maryland’s new domestic partnership law represents a significant step forward in recognizing and supporting diverse relationship structures. Contact us to schedule a call with one of our experienced estate planning attorneys to guide you through the nuances of the law so you can make an informed decision about entering a domestic partnership and how it affects your legal rights and responsibilities.

Sims & Campbell, LLC – Annapolis and Towson Estate Planning Attorneys

Read more about the article Corporate Transparency Act Creates New Reporting Requirements for Businesses- Annapolis and Towson Estate Planning

Corporate Transparency Act Creates New Reporting Requirements for Businesses- Annapolis and Towson Estate Planning

Effective January 1, 2024, the Corporate Transparency Act (the “CTA”) will implement beneficial ownership information reporting requirements for corporations, limited liability companies and other business entities that were created in or are registered to do business in the United States. The CTA requires that certain information about the business’ owners be provided to the Department of the Treasury’s Financial Crimes Enforcement Network (“FinCEN”) and imposes significant penalties for noncompliance.

The purpose of the CTA, which is part of a broader effort by FinCEN to try to crackdown on illegal activity such as money laundering, corruption, tax fraud and terrorist financing, is to provide greater transparency of owner information to try to prevent criminals from hiding illegal property in the United States.

Who is required to file?

Corporations, limited liability companies and other business entities that were created by a filing with a secretary of state or a similar office to create the entity or, for foreign companies, a registration to do business in the United States.

The CTA contains 23 exemptions, mostly for large companies, such as publicly traded corporations, and businesses that the federal government heavily regulates, as these companies are already providing the information to the government.

Limited liability companies created for estate planning purposes must comply with the CTA.

What to file?

A business that is required to report beneficial ownership information under the CTA (called a “reporting company”) will be required to provide:

  • legal name and any trade name or dba;
  • address;
  • jurisdiction in which it was formed or first registered, depending on whether it’s a U.S. or foreign company; and
  • taxpayer identification number.

For each reporting company’s beneficial owners and each reporting company applicant, the following information with respect to individual owners will also be required:

  • legal name;
  • birthdate;
  • address (in most cases, a home address); and
  • an identifying number from a driver’s license, passport or other approved document for each individual, as well as an image of the document that the number is from.

There can be up to two individuals who qualify as a reporting company’s applicants:

  • the individual who directly files the document that creates, or first registers, the reporting company; and
  • the individual that is primarily responsible for directing or controlling the filing of the relevant document.
  • A reporting company is only required to report company applicants if it is created or registered on or after January 1, 2024.

When to file?

  • A reporting company created or registered before January 1, 2024 is required to file before January 1, 2025.
  • A reporting company created or registered on or after January 1, 2024 is required to file within 30 calendar days of receiving actual or public notice that the company has been created, or upon receipt from your state’s secretary of state or similar office that the company was created or registered, whichever is earlier. FinCEN has reported that it will accept reports electronically beginning January 1, 2024. There is a proposal to extend the time to file for the first year to 90 days, but the extension has not been granted yet.

Please contact us with any questions.

Sims & Campbell, LLC- Annapolis and Towson Estate Planning Attorneys

Read more about the article Integrating Digital Assets for Estate Planning- Annapolis and Towson Estate Planning

Integrating Digital Assets for Estate Planning- Annapolis and Towson Estate Planning

Estate planning for digital assets is an increasingly important aspect of overall estate planning due to the growth of online accounts, cryptocurrencies, and other digital assets. It involves organizing and planning for the management and distribution of your digital assets in the event of your incapacity or passing. Here are key considerations and steps to effectively include digital assets in your estate plan:

  1. Take Inventory of Digital Assets: Start by creating a comprehensive list of your digital assets, including:
    • Financial Accounts: Online banking, investment accounts, PayPal, etc.
    • Social Media and Email Accounts: Facebook, Twitter, Gmail, etc.
    • Digital Media: Music, videos, ebooks, etc.
    • Cryptocurrencies: Bitcoin, Ethereum, etc.
    • Domain Names and Websites: If you own any.
    • Online Storage Accounts: Dropbox, Google Drive, etc.
  1. Organize Documentation and Access Information:
    • Document account information, login credentials, and any two-factor authentication codes.
    • Store this information securely, either in a physical location (like a safe deposit box) or a password manager. Ensure a trusted individual knows how to access this information.
  1. Appoint a Digital Executor:
    • Designate a trusted person as your digital executor in your will or estate plan.
    • Grant them the authority to access, manage, and distribute your digital assets in accordance with your wishes.
  1. Review Terms of Service Agreements:
    • Understand the terms of service for each digital platform or service you use, as they may have specific rules about transferring or accessing accounts after death.
    • Comply with any necessary procedures for handling digital assets outlined in these agreements.
  1. Communicate Your Wishes:
    • Clearly communicate your wishes regarding digital assets to your loved ones, digital executor, and any other relevant parties.
    • Provide guidance on how you want each type of digital asset handled, shared, or preserved.
  1. Regularly Update Your Plan:
    • Regularly review and update your estate plan, especially if you acquire new digital assets or change online account information.
  1. Consult with Professionals:
    • Seek advice from estate planning attorneys or financial advisors who are knowledgeable about digital asset planning to ensure your plan is thorough and legally sound.
  1. Consider Legal Assistance:
    • Depending on the complexity of your digital assets and your overall estate, consult a lawyer specializing in estate planning and digital asset management to ensure your plan is comprehensive and legally binding.

By integrating your digital assets into your estate plan, you can help ensure a smooth transition of your online presence and assets to your chosen beneficiaries and loved ones.

Contact us to schedule a complimentary call with one of our experienced estate planning attorneys!

Sims & Campbell, LLC– Annapolis and Towson Estate Planning Attorneys