In a recent Client Alert, CTM reported the U.S. District Court for the Eastern District of Texas issued a nationwide preliminary injunction against the Corporate Transparency Act (CTA) in Texas Top Cop Shop, Inc. v. Garland, preventing the federal government from enforcing its Beneficial Ownership Information Report (BOIR) filing requirements.

Under the CTA, businesses that fall within the scope of a Reporting Company are required to file a BOIR with the Treasury Department’s Financial Crimes Enforcement Network (FinCEN) per specified deadlines. The U.S. District Court’s preliminary injunction essentially blocked this reporting requirement.

At the time, we noted the preliminary injunction was temporary, and reporting companies may still be required to file their BOIR with FinCEN should the injunction be overturned or limited in some manner. This is exactly what has happened. On December 23, 2024, following the Department of Justice’s appeal, the United States Court of Appeals for the Fifth Circuit granted a stay on the injunction. The stay lifts the preliminary injunction and reinstates the BOI reporting requirement under the CTA while the government appeals the case.

In response to the Fifth Circuit’s stay, FinCEN immediately issued an alert advising it will extend the reporting deadlines for reporting companies as they may need additional time to comply with the BOIR requirement.

The new reporting deadlines are as follows:

• Reporting Companies created on or registered before January 1, 2024, originally required to submit an initial BOIR to FinCEN by January 1, 2025, may now file by January 13, 2025.
• Reporting Companies created or registered on or after September 4, 2024, originally required to submit an initial BOIR to FinCEN between December 3 and December 23, 2024, may now file by January 13, 2025.
• Reporting Companies created or registered on or after December 3, 2024, and on or before December 23, 2024, have an additional 21 days from their original filing deadline to file initial BOIRs with FinCEN.
• Reporting Companies created on or after January 1, 2025, are still required to submit initial BOIRs to FinCEN within 30 days of formation or registration.
• Finally, Reporting Companies that qualify for disaster relief may have extended deadlines that fall beyond January 13, 2025.

While it is impossible to predict how this case ultimately will be decided, the Fifth Circuit stated in its order that “the government has made a strong showing that it is likely to succeed on the merits in defending CTA’s constitutionality.”

CTM is providing this alert on an information-only basis.  It is not intended to serve as legal guidance or advice.  For further clarification, please consult with an attorney.