Last week, one of the legal challenges (Texas Top Cop Shop, Inc., et al. v. Garland, et al.) to the Corporate Transparency Act (CTA) resulted in the U.S. District Court for the Eastern District of Texas issuing a nationwide preliminary injunction preventing the federal government from enforcing its Beneficial Ownership Information Report (BOIR) filing requirements for “reporting companies.”

Under the CTA, U.S. 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 the following deadlines.

• Reporting Companies created on or registered before January 1, 2024, must submit an initial BOIR to FinCEN by January 1, 2025.
• Reporting Companies created or registered in the calendar year 2024, must submit an initial BOIR to FinCEN within 90 days of formation or registration.
• Reporting Companies created on or after January 1, 2025, are required to submit initial BOIRs to FinCEN within 30 days of formation or registration.

The Texas District Court’s ruling has created a lot of uncertainty for many businesses as the reporting deadline draws near.  Some businesses may choose to pause their compliance efforts, while others may voluntarily submit their BOIR on the FinCEN website.  FinCEN recently issued a BOI e-fling alert advising that reporting companies are not currently required to file a BOIR and will not be subject to liability for not filing while the order remains in effect. However, it is important to note the preliminary injunction is temporary, and as this legal proceeding makes its way through the courts, reporting companies may still be required to file their BOIR with FinCEN should the injunction be overturned or limited in some manner.

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.