Corporate Transparency Act Reporting Requirements Back in Effect
FinCEN’s Corporate Transparency Act (CTA) Beneficial Ownership Information (BOI) reporting is once again back in effect, with a new deadline of March 21, 2025, for most companies.
In the latest decision in a series of back-and-forth rulings, on February 18, 2025, the U.S. District Court for the Eastern District of Texas in Smith, et al. v. U.S. Department of the Treasury stayed its January 7, 2025, order until the U.S. Department of Justice’s appeal is complete. As a result, many small businesses are now required to comply with the CTA’s reporting requirements.
Confused? We’ve included an updated break down below.
December 3, 2024: A judge in the U.S. District Court for the Eastern District of Texas issues a preliminary injunction staying the CTA on the basis that it is likely unconstitutional. Following the District Court’s ruling, FinCEN recognized the court order and stated that reporting companies are not required to file a BOI report and are not subject to liability if they fail to do so while the applicable order remains in force.
December 23, 2024: The Fifth Circuit’s motions panel overturns the preliminary injunction, reimposing the CTA and its reporting deadlines. FinCEN then extends the CTA reporting deadline to January 13, 2025.
December 26, 2024: A separate merits panel of the Fifth Circuit vacates the motions panel’s December 23rd decision “in order to preserve the constitutional status quo” while considering the arguments. Consequently, no businesses are required to file CTA reports as of today.
December 26, 2024: The Government petitioned the Supreme Court to intervene and stay the Texas Top Cop Shop preliminary injunction. The response to the Solicitor General's Application to the Supreme Court was requested by Justice Alito by January 10, 2025.
January 7, 2025: The U.S. District Court for the Eastern District of Texas issued an order staying FinCEN’s regulations implementing the BOI reporting requirements, precluding FinCEN from requiring BOI reporting or otherwise enforcing the CTA’s requirements.
February 5, 2025: The U.S. Department of Justice, on behalf of the Treasury, filed a notice of appeal of the district court’s order and, requested a stay of the order during the appeal.
February 18, 2025: The U.S. District Court for the Eastern District of Texas agreed to stay its January 7, 2025, order until the appeal is completed. BOI reporting is now mandatory but is subject to applicable court orders.
Updated Deadlines
Between now and March 21, 2025, FinCen will assess options to modify deadlines, while prioritizing reporting for entities that pose the most significant national security risks. Though BOI reporting is currently mandatory, it is subject to applicable court orders and its status may change. See the updated deadlines below.
For the vast majority of reporting companies, the new deadline to file an initial, updated, and/ or corrected BOI report is now March 21, 2025. FinCEN will provide an update before then of any further modification of this deadline, recognizing that reporting companies may need additional time to comply with their BOI reporting obligations once this update is provided.
Reporting companies that were previously given a reporting deadline later than the March 21, 2025, deadline must file their initial BOI report by that later deadline. For example, if a company’s reporting deadline is in April 2025 because it qualifies for certain disaster relief extensions, it should follow the April deadline, not the March deadline.
As indicated in the alert titled “Notice Regarding National Small Business United v. Yellen, No. 5:22-cv-01448 (N.D. Ala.)”, Plaintiffs in National Small Business United v. Yellen, No. 5:22-cv01448 (N.D. Ala.)—namely, Isaac Winkles, reporting companies for which Isaac Winkles is the beneficial owner or applicant, the National Small Business Association, and members of the National Small Business Association (as of March 1, 2024)—are not currently required to report their beneficial ownership information to FinCEN at this time.
We encourage all our business client’s to closely monitor FinCen’s BOI E-Filing site here for possible updates and revisions.
You can file your BOI Report online, here.
Action in Congress?
Two bills in Congress could provide more clarity around BOI reporting. On Feb. 10, the House passed HR736, the Protect Small Business from Excessive Paperwork Act. The bill postpones the BOI reporting deadline for some companies to Jan. 1, 2026. With bipartisan support, the bill is currently in the hands of a Senate committee.
Meanwhile, the reintroduced Repealing Big Brother Overreach Act aims to eliminate the Corporate Transparency Act all together. However, this lacks bipartisan support and still sits in committee.
