Back In The Saddle Again! The CTA Saga Continues...

A judge in the U.S. District Court for the Eastern District of Texas issued an injunction on January 7, 2025 in Smith, et al. v. U.S. Department of the Treasury, et al., which halted the enforceability of the Corporate Transparency Act (CTA) with nationwide effect. 

The US Supreme Court subsequently stayed the injunction on the CTA in the Texas Top Cop Shop case.

The Smith court has now stayed the injunction in that case as of February 18, 2025, citing the decision of the Supreme Court in the Texas Top Cop Shop case.

FinCEN had previosly stated it would provide 30 days for companies to report if the injunction was lifted. Following the Smith injunction stay, FinCEN confirmed, the new deadline for companies to file their BOI reports is March 21, 2025.

At the same time, the current administration has been making waves with sweeping changes in the government. Will FinCEN become a target for change and enforcement of the CTA suspended?

Also in play, the House of Representatives unanimously passed a bill on February 12, 2025 that would extend the filing deadline to January 1, 2026 for reporting entities that existed before January 1, 2024 and sent it on the senate for review.

UPDATE:

On February 27, 2025, FinCEN sent out the following notice:

FinCEN Not Issuing Fines or Penalties in Connection with Beneficial Ownership Information Reporting Deadlines

Immediate release: February 27, 2025

WASHINGTON––Today, FinCEN announced that it will not issue any fines or penalties or take any other enforcement actions against any companies based on any failure to file or update beneficial ownership information (BOI) reports pursuant to the Corporate Transparency Act by the current deadlines. No fines or penalties will be issued, and no enforcement actions will be taken, until a forthcoming interim final rule becomes effective and the new relevant due dates in the interim final rule have passed. This announcement continues Treasury’s commitment to reducing regulatory burden on businesses, as well as prioritizing under the Corporate Transparency Act reporting of BOI for those entities that pose the most significant law enforcement and national security risks.

No later than March 21, 2025, FinCEN intends to issue an interim final rule that extends BOI reporting deadlines, recognizing the need to provide new guidance and clarity as quickly as possible, while ensuring that BOI that is highly useful to important national security, intelligence, and law enforcement activities is reported.

FinCEN also intends to solicit public comment on potential revisions to existing BOI reporting requirements. FinCEN will consider those comments as part of a notice of proposed rulemaking anticipated to be issued later this year to minimize burden on small businesses while ensuring that BOI is highly useful to important national security, intelligence, and law enforcement activities, as well to determine what, if any, modifications to the deadlines referenced here should be considered.

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