On Friday, January 24, 2025, the Financial Crimes Enforcement Network (“FinCEN”) issued the following Alert regarding the current state of filing requirements under the CTA:

In light of a recent federal court order, reporting companies are not currently required to file beneficial ownership information with FinCEN and are not subject to liability if they fail to do so while the order remains in force. However, reporting companies may continue to voluntarily submit beneficial ownership information reports.

On January 23, 2025, the Supreme Court granted the government’s motion to stay a nationwide injunction issued by a federal judge in Texas (Texas Top Cop Shop, Inc. v. McHenry). However, a second nationwide order issued by a different federal judge in Texas (Smith v. U.S. Department of the Treasury) still remains in effect enjoining enforcement by FinCEN of the CTA beneficial ownership reporting deadlines and requirements.

You can access FinCEN’s BOI Alerts here.

Therefore currently, companies subject to the CTA are not subject to liability if they fail to file the beneficial ownership information reports (while the Smith order remains in effect). Companies may continue to voluntarily submit beneficial ownership information reports.

Recent rulings:

• On December 3, 2024, the U.S. District Court for the Eastern District of Texas issued a nationwide injunction enjoining enforcement of the CTA, suspending all reporting obligations under the act (Texas Top Cop Shop, Inc. v. McHenry – formerly, Texas Top Cop Shop v. Garland), amended December 5, 2024.
• On December 23, 2024, the U.S. Court of Appeals for the Fifth Circuit granted a stay of the Eastern District Court’s injunction re-instating reporting deadlines for companies subject to the CTA. FinCEN issued an Alert extending the reporting deadlines.
• On December 26, 2024, the Fifth Circuit vacated the stay and restored the Eastern District’s injunction and suspending reporting obligations pending the appeal.
• On December 31, 2024, the United States Department of Justice filed a motion for stay with the U.S. Supreme Court requesting that the Eastern District’s injunction be stayed while the appeal was pending.
• On January 7, 2025, the U.S. District Court for the Northern District of Texas (in Smith vs. US Department of the Treasury) issued a second nationwide injunction enjoining enforcement of the CTA, the effect of which was to suspend all reporting obligations under the CTA which continues currently.
• On January 23, 2025 , the U.S. Supreme Court granted a stay of the Eastern District’s injunction pending the disposition of appeal pending before the Fifth Circuit.
• On January 24, 2025, FinCEN issued an Alert confirming that reporting obligations continue to be stayed under the CTA, pending final resolution of all appeals. 

Companies subject to the CTA are encouraged to stay informed regarding the rapid developments concerning enforcement of BOI reporting requirements under the CTA.

If you are a  client and would like more information regarding the CTA, please contact Shields Legal. This CTA Update is intended as general information only and you should consult your own legal advisor on any legal question concerning your company’s compliance with the CTA.

Related Articles

12/6/24 — Texas Federal Court Halts Implementation of Corporate Transparency Act

11/26/24 — Notice Regarding Corporate Transparency Act

4/14/24 — What You Need to Know About the Corporate Transparency Act

2/22/24 — The Corporate Transparency Act: Lender Considerations