Corporate Transparency Act Resource Center
The Corporate Transparency Act (CTA) is a federal law that requires certain business entities (reporting companies) to submit beneficial ownership information reports (BOIRs) to the Financial Crimes Enforcement Network of the Department of the Treasury (FinCEN). The BOIRs require reporting companies to disclose information about the entity and the identities and other personal information about their company applicants that actually form the entity and their beneficial owners that own 25% or more of the entity or have substantial control over the entity (regardless of whether they have any actual ownership). Since the CTA took effect on January 1, 2024, there have been many legal challenges to it, and they have reached different conclusions, making it dizzying to try to keep up. Attorneys in Shipman's Business and Corporate practice have created this resource page to track the CTA’s requirements and its enforcement twists and turns. Developments appear in reverse chronological order, with the latest developments at the top.
Corporate Transparency Act - The Gift That Keeps on Giving - Government Appeals to the U.S. Supreme Court to Eliminate Nationwide Injunction
Date: January 3, 2025
Not content to have an expedited hearing in March on the merits of the case at the Fifth Circuit Court of Appeals regarding the constitutionality of the Corporate Transparency Act (CTA), the Government filed an application with the U.S. Supreme Court on New Year’s Eve to stay (eliminate) the nationwide injunction or to at least narrow it to the plaintiffs in the case (Texas Top Cop Shop, Inc., et al. v. Merrick Garland, Attorney General of the United States, et al.). The preliminary nationwide injunction currently in effect means that the Financial Crimes Enforcement Network of the Department of Treasury (FinCEN) cannot enforce the CTA, and reporting companies are not required to file (or update) their beneficial ownership information reports (BOIRs).
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It's Déjà Vu All Over Again - Corporate Transparency Act Nationwide Injunction is Reinstated
Date: December 27, 2024
Okay, let’s follow the bouncing the ball. On December 3, 2024, the U.S. District Court for the Eastern District of Texas/Sherman Division entered an order enjoining the enforcement of the Corporate Transparency Act (CTA) and its corresponding Reporting Rule. The Government requested a stay of the preliminary injunction, which the District Court denied. The Government appealed, and on December 23, 2024, a motions panel of the Fifth Circuit Court of Appeals granted the Government’s emergency motion for a stay pending appeal, which lifted the injunction and reinstated the CTA and the Reporting Rule. The Financial Crimes Enforcement Network of the Department of Treasury (FinCEN) then extended some of the filing deadlines as we reported in our prior alert.
The motions panel also ordered an expedited appeal on the merits of the case. The merits panel now has the appeal, which remains expedited, and a briefing schedule will be forthcoming. However, to preserve the constitutional status quo while the merits panel considers the parties’ weighty substantive arguments, the merits panel of the Fifth Circuit has vacated the part of the motions-panel order granting the Government’s motion to stay the district court’s preliminary injunction enjoining enforcement of the CTA and the Reporting Rule. That means the nationwide preliminary injunction is back in place.
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Corporate Transparency Act: Nationwide Injunction Lifted and Deadlines Reinstated With Some Extensions
Date: December 24, 2024
As a follow-up to our alert on December 23, 2024 that the nationwide injunction related to the enforcement of the Corporate Transparency Act has been lifted and filings of beneficial ownership information reports by reporting companies should resume, the Financial Crimes Enforcement Network of the U.S. Department of Treasury (FinCEN) has just posted the following alert with various filing deadline extensions.
In light of a December 23, 2024, federal Court of Appeals decision, reporting companies, except as indicated below, are once again required to file beneficial ownership information with FinCEN. However, because the Department of the Treasury recognizes that reporting companies may need additional time to comply given the period when the preliminary injunction had been in effect, we have extended the reporting deadline as follows:
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Corporate Transparency Act: Nationwide Injunction Lifted and Filing Deadlines Reinstated
Date: December 23, 2024
As we previously reported, on December 3, 2024, in Texas Top Cop Shop, Inc., et al. v. Merrick Garland, Attorney General of the United States, et al., Judge Amos Mazzant of the United States District Court (Eastern District of Texas/Sherman Division) issued a preliminary nationwide injunction barring the enforcement of the Corporate Transparency Act (CTA).
Today, the Fifth Circuit Court of Appeals stayed the injunction, meaning that the injunction is no longer in effect, and the Financial Crimes Enforcement Network of the U.S. Department of Treasury (FinCEN) may again enforce the CTA.
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Nationwide Injunction Temporarily Bars Enforcement of the Corporate Transparency Act
Date: December 4, 2024
On December 3, 2024, in Texas Top Cop Shop, Inc., et al. v. Merrick Garland, Attorney General of the United States, et al., Judge Amos Mazzant of the United States District Court (Eastern District of Texas/Sherman Division) issued a preliminary nationwide injunction barring the enforcement of the Corporate Transparency Act (CTA) finding the following:
Having determined that Plaintiffs have carried their burden, the Court GRANTS Plaintiff’s Motion for a Preliminary Injunction. Therefore, the CTA, 31 U.S.C. § 5336 is hereby enjoined. Enforcement of the Reporting Rule, 31 C.F.R. 1010.380 is also hereby enjoined, and the compliance deadline is stayed under § 705 of the APA [Administrative Procedure Act]. Neither may be enforced, and reporting companies need not comply with the CTA’s January 1, 2025, BOI [beneficial ownership information] reporting deadline pending further order of the Court.
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Corporate Transparency Act (CTA) Compliance - Frequently Asked Questions
Date: January 1, 2024
Attorneys in Shipman's Business and Corporate practice have prepared this FAQ document on the Corporate Transparency Act (CTA), which takes effect on January 1, 2024.
