The Corporate Transparency Act (CTA) enforcement deadline is back in effect following a December 23, 2024, ruling by the US Court of Appeals for the Fifth Circuit. This decision reversed a nationwide injunction that had temporarily blocked the law's implementation. The requirement for companies to file beneficial ownership information (BOI) through the Financial Crimes Enforcement Network (FinCEN) website has now been reinstated.

FinCEN Extends Reporting Deadlines

Recognizing the potential compliance challenges caused by the temporary injunction, FinCEN extended the filing deadlines for reporting companies:

1. Entities created or registered before January 1, 2024: Deadline extended to January 13, 2025.
2. Entities created or registered between December 3, 2024, and December 23, 2024: Granted an additional 21 days from their original filing deadline.
3. Entities created or registered on or after January 1, 2025: Must file within 30 days of their effective creation or registration date.
4. Entities qualifying for disaster relief: May have deadlines beyond January 13, 2025, as applicable.

Rationale Behind the Fifth Circuit Decision

The Fifth Circuit panel ruled that the CTA’s reporting requirements align with over a century of precedent under the Commerce Clause. The government successfully argued that the temporary injunction disrupted compliance efforts, noting that nearly one-third of the 10 million beneficial ownership reports already submitted to FinCEN were filed in the three weeks preceding the injunction. Filing rates reached almost 1 million reports per week during this period.

The court also emphasized the broader implications of the injunction, stating, “A last-minute nationwide preliminary injunction would undermine our ability to push other countries to reform their anti-money laundering and counterterrorism regimes and address a critical gap in our own system.”

Next Steps

Businesses are encouraged to review their obligations and file beneficial ownership information with FinCEN before the updated deadlines. Ensuring timely and accurate reporting will be critical to maintaining compliance.

We encourage you to visit FinCEN's BOI webpage, which contains reference materials and resources for small businesses as they navigate reporting requirements.