On December 23, 2024, the US Court of Appeals for the Fifth Circuit granted an emergency motion by the federal government to stay the nationwide preliminary injunction that had suspended enforcement of the Corporate Transparency Act (CTA) and stayed its compliance deadlines, including the January 1, 2025, compliance deadline for reporting companies formed prior to January 1, 2024.
The Fifth Circuit's action had the effect of immediately reinstating the compliance deadline for millions of entities that are potentially required to file beneficial ownership information with the US Financial Crimes Enforcement Network (FinCEN) and had not yet done so as of early December 2024.
However, within hours of the Fifth Circuit's decision, FinCEN released a statement on its website extending the compliance deadline for reporting companies in light of the period when the preliminary injunction was in effect.
Extended Deadlines
The extended deadlines for filing initial beneficial ownership reports are:
- Reporting companies that were formed or registered prior to January 1, 2024, have until January 13, 2025, to file.
- Reporting companies that were formed or registered 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.
- Reporting companies that were formed or registered 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.
FinCEN's statement confirms that the accelerated timeline for reporting companies formed or registered on or after January 1, 2025, will take effect. These new reporting companies will be required to submit beneficial ownership within 30 days of formation or registration, as applicable.
FinCEN's statement does not address deadlines applicable to reporting companies that had already filed on or after January 1, 2024, and whose original filing information had since been amended. These companies will continue to be required to submit the revised entity information within 30 days of the amendment.
Next Steps
On December 24, 2024, the plaintiffs moved for expedited rehearing by the full Fifth Circuit to reconsider the ruling. The plaintiffs are seeking a ruling by January 6, 2025, based on the extended deadlines discussed above. Further action by the Fifth Circuit, or potentially the US Supreme Court, could further affect the compliance deadlines.
Conclusion
While the extended deadlines offer some relief for companies otherwise facing a year-end compliance deadline, companies that may be subject to the CTA's reporting obligations and that have not filed beneficial ownership reports should take immediate steps to either confirm that no filings are required (e.g., the company is exempt from filing) or to make any required filings prior to the applicable deadline. Companies should also continue to closely monitor the ongoing litigation in the Fifth Circuit in case the injunction is reinstated or the compliance deadlines further adjusted.
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