Unexpected Turn of Events in the Lawsuit Regarding the Corporate Transparency Act (CTA)
On December 26, 2024, the Fifth Circuit merits panel reinstituted the preliminary injunction against the enforcement of the Corporate Transparency Act (CTA); thereby, there is no requirement or deadline to file a company Beneficial Ownership Information (BOI) report pursuant to the CTA.
Companies may still voluntarily file their BOI reports with U.S. Treasury’s FinCEN (financial crimes) Division. However, for the time being, they are not required to comply with the CTA reporting deadlines (neither the original January 1 deadline, nor the revised deadline of January 13). The ruling, however, is still not a final determination of the CTA’s constitutionality. Instead, it only temporarily halts deadlines while the case continues to proceed. This could potentially be appealed to the Supreme Court and further action is still required within the lower courts. All of which could once again change the deadlines and requirements in the future. Businesses should remain cautious and continue to understand that this recent pause may still only be temporary.
In December, the following has occurred:
- December 03, 2024: District Court in Texas suspends the deadlines for the CTA BOI reports.
- December 23, 2024: 5th Circuit Court of Appeals reinstates the January 1 deadline.
- December 23, 2024: FinCEN announces a new deadline of January 13 for the CTA BOI reports.
- December 26, 2024: 5th Circuit Court of Appeals, on second thought, decides that the suspension of the deadlines is the best course as the lawsuit continues to be litigated.
We continue to recognize this is very frustrating and likely confusing to all small businesses. We will continue to do our best to update you in real time so that you have the most current information