The U.S. Court of Appeals for the Fifth Circuit has once again altered the legal landscape regarding the Corporate Transparency Act (CTA). On December 26, 2024, the court reinstated a nationwide preliminary injunction, pausing the enforcement of the CTA, including the associated filing deadlines.
For the moment, companies are once again not required to submit reports required under the CTA. This includes beneficial ownership information (BOI) reports for companies formed before 2024, previously due by January 13, 2025, under a recent extension from FinCEN. Reporting companies might choose to delay filing until the Fifth Circuit makes a final decision about the CTA’s constitutionality, though voluntary filings are still allowed. However, the Fifth Circuit’s ruling in Texas Top Cop Shop is unlikely to be the final word. The case will likely move to the U.S. Supreme Court, and with a new administration taking office, it is uncertain how the CTA will be handled moving forward.
Given the fluid nature of this situation, reporting companies and their beneficial owners should consult legal counsel and closely monitor further developments, including additional court decisions or guidance from FinCEN, which could impact compliance requirements and their timing. Entities subject to the CTA are encouraged to continue preparing their BOI reports to ensure readiness should the injunction be lifted.
The information provided herein is not intended to provide legal advice to the reader. CTA compliance is extremely fact intensive and varies depending on the specific circumstance. If you have questions or require assistance in complying with the CTA, please contact Blake Gabriel for more information.
Additional information, past updates, and specifics about CTA reporting requirements can be found on our website here.
