Corporate Transparency Act Update

Important Update!

File Corporate Transparency Act (CTA) by March 21^st, 2025.

There has been a recent update regarding the Corporate Transparency Act (CTA) and its current enforcement status. Recent legal challenges had temporarily halted enforcement, but with all injunctions lifted, the Financial Crimes Enforcement Network (FinCEN) has resumed enforcement, and entities are now required to comply with the CTA’s reporting requirements.

Legal Challenges and Updates:

Texas Top Cop Shop v. Garland: In December, 2024, a Texas federal judge issued a nationwide preliminary injunction halting the CTA’s reporting requirements. However, this injunction was lifted by the U.S. Supreme Court the following month, allowing enforcement to proceed.

Smith v. U.S. Department of the Treasury: Also in January 2025, a separate injunction was issued in Texas, which remained in effect until it was lifted just recently this February. This cleared the final legal barrier to enforcement.

Legislative Action:

Meanwhile, in early 2025, the U.S. House of Representatives unanimously passed the Protect Small Businesses from Excessive Paperwork Act, granting small businesses formed before January 1, 2024, an additional year to comply with the CTA’s beneficial ownership information (BOI) reporting requirements. A companion bill is under consideration in the Senate but has not yet passed.

With all legal barriers now removed, FinCEN has confirmed that entities are required to file beneficial ownership information. To allow adequate preparation time, FinCEN has extended the filing deadline to March 21, 2025.

Though there are no updates on enforcement of penalties at this time, the CTA imposes civil penalties for non-compliance. Specifically, a $591 fine per person per day may be assessed for each violation.

How We Can Help:

Given these developments, we recommend ensuring timely compliance with the CTA by March 21, 2025. If you would like to complete your reporting early to avoid any last-minute complications, we are ready to assist.

Please let us know if you wish to proceed with the filing. If you have any questions regarding the current enforcement status of the Corporate Transparency Act, a link to the update is here.