We are writing to inform you yet again, on developments in the on-going litigation matters surrounding the Corporate Transparency Act (“CTA”) and its provisions mandating that certain entities disclose information concerning their beneficial owners to the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (“FinCEN”).
On February 18, 2025, the last remaining nationwide injunction, in Smith, et al v. U.S. Department of Treasury, et al., 6:24-cv-00336 (E.D. Tex.), which had been prohibiting the government’s enforcement of the CTA has been stayed. With the staying of the Smith injunction, the Federal government is permitted to once again enforce the provisions of the CTA, including its penalties for failure to file. In the notification posted to its website, FinCEN has made it clear that it intends to do so, stating “beneficial ownership information (BOI) reporting obligations are once again back in effect”.
In response to the period during which the reporting requirements were paused, FinCEN has generally extended the filing deadline until March 21, 2025, for most reporting companies. While FinCEN continues to evaluate the need for further deadline extensions (stating in its notice, that if there are further modifications to the deadline, it will provide an update before the March 21, 2025 deadline), and although a bipartisan bill has been introduced in Congress proposing a delay of the reporting requirements until Jan. 1, 2026, the current deadline remains firm. As such, entities should proceed with filing without delay.
This is likely not the last we will be hearing of the CTA and its ever-changing filing deadlines. There continue to be pending appeals court cases related to the constitutionality of the CTA in addition to the pending legislation noted above. As always, we will continue to closely monitor this legal matter and update you on any further developments. Should the situation change, we will provide guidance on next steps and assist you in ensuring compliance with any new requirements.
If you have any questions or need further clarification regarding how this ruling may affect your business, please do not hesitate to contact us at businessmatters@fletchertilton.com. If you are already in contact with someone at the firm concerning your requirements under the CTA, please direct any comments to your primary contact. We appreciate the privilege of providing legal services to our clients.
