UPDATE: As of December 27, 2024, the latest ruling has been stayed, and the injunction made on December 3, 2024, by the Fifth Circuit stands. Learn more here.
On Monday, December 23, 2024, a three-judge panel of the United States Circuit Court of Appeals for the Fifth Circuit (the “Fifth Circuit Court of Appeals”) lifted the nationwide injunction issued on December 3, 2024, by a federal judge in Texas who concluded that the Corporate Transparency Act was unconstitutional. This latest ruling (12/23/2024) causes the Corporate Transparency Act (“CTA”), which went into effect on January 1, 2024, to be once again fully enforceable.
Following the Fifth Circuit Court of Appeals ruling, the Financial Crimes Enforcement Network (“FinCEN”) announced extended deadlines on December 23, 2024, for fulfilling initial reporting obligations under the CTA (see below).
As reported by the National Law Review, “This situation is rapidly evolving. In the coming days, the challengers in this case could seek further review from the Fifth Circuit or seek relief from the United States Supreme Court. Additionally, several other federal courts are actively considering challenges against the CTA.”
THE EFFECTS OF THE RULING
Corporations, limited liability companies, and limited partnerships created or registered to do business in the United States (each a “Reporting Company”) are required to file a Beneficial Ownership Information Report (“BOIR”) with FinCEN unless the Reporting Company is exempt.
BOIR FILING DEADLINES
- Reporting companies that were created or registered prior to January 1, 2024, have until January 13, 2025, to file their initial beneficial ownership information reports with FinCEN. (These companies would otherwise have been required to report by January 1, 2025.)
- Reporting companies created or registered in the United States on or after September 4, 2024, that had a filing deadline between December 3, 2024, and December 23, 2024, have until January 13, 2025, to file their initial beneficial ownership information reports with FinCEN.
- Reporting companies created or registered in the United States 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 their initial beneficial ownership information reports with FinCEN.
Learn more about the Corporate Transparency Act, the information to be provided to FinCEN, and FinCEN Identifiers in our previous Corporate Transparency Act post, which can be found here.
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