Compliance with the Corporate Transparency Act (the "CTA") is no longer voluntary. Businesses subject to the CTA, which includes the majority of entities formed or registered to do business in the United States, will have until March 21, 2025, to file their beneficial ownership information reports with the U.S. Treasury Financial Crimes Enforcement Network ("FinCEN"). Though enforcement of the CTA was previously temporarily enjoined, the United States District Court for the Eastern District of Texas granted the government's motion to stay the injunction, effectively lifting the nationwide "pause" on enforcement of the CTA. FinCEN has now issued updated guidance to reporting companies regarding the timing of filing beneficial ownership information reports.
Meanwhile, CTA challenges and a vigorous defense by FinCEN continue in courts around the nation and multiple bills modifying or repealing the CTA are in legislative process. FinCen has also indicated that it will be reviewing its own regulations with an eye towards easing the regulatory burden on businesses. Any updates may impact the effect and timing of CTA requirements.
For companies that put a pause on CTA analysis or filings, time is of the essence to get back on track. As long as there is no nationwide injunction in place, the requirements of the CTA are generally enforceable. Companies should continue to monitor the CTA to determine any necessary compliance. The attorneys at Stites & Harbison are available to help.
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