Reporting obligations related to the Corporate Transparency Act ("the CTA") are set to return. As we previously reported, on December 3, 2024, a federal judge in Texas (Texas Top Cop Shop, Inc. v. Bessent) issued a nationwide preliminary injunction preventing the federal government from enforcing the CTA. The U.S. Court of Appeals for the Fifth Circuit expedited briefing on the merits and left that injunction in place, but the U.S. Supreme Court ultimately stayed the effect of that injunction on January 23, 2025. The reporting obligations did not immediately spring back into effect, however, because a different federal judge in Texas (Smith v. U.S. Department of the Treasury) had issued a nationwide preliminary injunction in a separate case. On February 18, 2025, that district court stayed the effect of its preliminary injunction based on the Supreme Court's January 23 stay.
While expedited litigation continues in the U.S. Court of Appeals for the Fifth Circuit, the Treasury Department and its Financial Crimes Enforcement Network, known as "FinCEN," has announced that the beneficial ownership reporting obligations under the CTA are once again in effect.
However, FinCEN has issued guidance extending the filing deadline 30 calendar days for most companies:
- For most reporting companies, the new deadline to file an initial, updated, and/or corrected beneficial ownership report is now March 21, 2025.
- Reporting companies that were previously given a reporting deadline later than the March 21, 2025 deadline must file their initial report by that later deadline. For example, if a company's reporting deadline is in April 2025 because it qualifies for certain disaster relief extensions, it should follow the April deadline, not the March deadline.
Reporting companies formed or registered on or after February 18, 2025, or reporting companies that on or after February 18, 2025 have an update or correction to previously reported information, will be subject to the standard reporting deadline under the CTA. That deadline requires filing an initial, updated, and/or corrected beneficial ownership report within 30 days of (i) formation or registration, (ii) the date of a change, or (iii) becoming aware of an inaccuracy, as applicable.
FinCEN has indicated that it is considering options to further modify deadlines while prioritizing reporting for those entities that pose "the most significant national security risks." Further, it has stated it will provide an update before March 21, 2025 as to any further modification of the deadlines, recognizing that reporting companies may need additional time to comply with their reporting obligations once this update is provided.
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