In an order issued December 23, 2024, the United States Court of Appeals for the Fifth Circuit set aside a nationwide injunction that had suspended the requirements of the Corporate Transparency Act (“CTA”) and regulations enacted for enforcement of the CTA by the Financial Crimes Enforcement Network (“FinCEN”).[1]
As with the injunction itself, the Fifth Circuit’s order is not a final determination on the legality or constitutionality of the CTA or underlying regulations, as those arguments have yet to be heard and finally determined by the courts. This order does, however, allow FinCEN to proceed with enforcement of its regulations in the meantime.
The requirement for every business entity that is a “reporting company” under the CTA to file a “beneficial ownership information report” with FinCEN is back in effect.[2]
Importantly, FinCEN has given extensions of certain reporting deadlines affected by the injunction.[3] The applicable deadline for a reporting company depends on when the reporting company was effectively formed as a legal entity or first registered to do business within the United States.
If created or registered prior to January 1, 2024:
- A reporting company created or registered to do business in a U.S. state, territory, or tribal nation prior to January 1, 2024, will have until January 13, 2025, to file its initial beneficial ownership information report with FinCEN at https://boiefiling.fincen.gov/.
If created or registered during 2024:
- A reporting company created or registered to do business in a U.S. state, territory, or tribal nation on or after September 4, 2024 that had a filing deadline between December 3, 2024 and December 23, 2024 will have until January 13, 2025 to file its initial beneficial ownership information report with FinCEN at https://boiefiling.fincen.gov/.
- A reporting company created or registered to do business in a U.S. state, territory, or tribal nation on or after December 3, 2024 and on or before December 23, 2024 will have ninety days from the date of the reporting company’s effective formation plus an additional twenty-one days to file its initial beneficial ownership information report with FinCEN at https://boiefiling.fincen.gov/.
- A reporting company created or registered to do business in a U.S. state, territory, or tribal nation on after December 23, 2024 and on or before December 31, 2024, will have ninety days from the date of effective formation to file its initial beneficial ownership information report with FinCEN at https://boiefiling.fincen.gov/.
If created or registered after 2024:
- A reporting company created or registered to do business in a U.S. state, territory, or tribal nation on or after January 1, 2025 will have thirty days from the date of effective formation to file its initial beneficial ownership information reports with FinCEN at https://boiefiling.fincen.gov/.
If eligible for extensions due to recent natural disasters:
- A reporting company that qualified for one of FinCEN’s disaster relief extensions must file by the later of either January 13, 2025, or an extended deadline given under the applicable disaster relief program.[4]
Litigation and appeals pertaining to the CTA continue, but January 13, 2025, is quickly approaching. Those reporting companies that have not already either met their reporting obligations or determined that they are exempt under the CTA must be prepared to report to FinCEN by the applicable deadline to avoid potential legal liability. Willful failure to file as required by the CTA could result in civil or criminal penalties. Tucker Arensberg attorneys will continue to monitor these developments. If you have questions or concerns regarding the CTA generally or this latest development, please contact one of our attorneys if you need further assistance.
[1] Texas Top Cop Shop, Inc. v. Garland, No. 24-40792 (5th Cir. Dec. 23, 2024) (order granting emergency motion for stay pending appeal).
[2] For detailed discussion and explanation of the CTA and FinCEN’s regulations, see our firm’s previous post on the CTA here.
[3] Financial Crimes Enforcement Network, BOI |Beneficial Ownership Information, https://www.fincen.gov/boi (last visited Dec. 24, 2024 10:30 AM) (see the section titled, “Alert:Updates to Beneficial Ownership Information Reporting Deadlines – Beneficial Ownership Information Reporting Requirements Now in Effect, with Deadline Extensions”).
[4] Financial Crimes Enforcement Network, FinCEN Provides Beneficial Ownership Information Reporting Relief to Victims of Recent Natural Disasters (Oct. 29, 2024) https://www.fincen.gov/news/news-releases/fincen-provides-beneficial-ownership-information-reporting-relief-victims-recent.
