Folks, we are back to it; the Corporate Transparency Act (“CTA:). I previously posted about the ongoing saga that is the implementation of the CTA here, if you are looking for a quick refresher. Last we visited our fledgling new law promoted to help the government crack down on national security threats, the reporting requirements for millions of entities were put on hold by a little U.S. District Court in the Eastern District of Texas (Smith v. U.S. Department of the Treasury). Well, that same court has now reversed itself and stayed its own injunction. Specifically, the District Court in Smith v. U.S. Department of the Treasury stayed its injunction preventing the Financial Crimes Enforcement Network (“FINCEN”) from enforcing the reporting requirements under the CTA requiring millions of qualifying business entities to disclose the Beneficial Ownership Information (“BOI”).
As previously discussed, under the original deadline entities were to report such information by January 1, 2025. As also previously discussed in my prior post referenced above, through a gauntlet of legal machinations this filing deadline was halfted, started, halted, … I’m dizzy. Back to the present day. As of the above-referenced latest order in Smith, enforcement of the CTA reporting requirements is back on. FINCEN wasted no time, stayed true to its prior representations to the court, and promptly issued a February 18, 2025 notice setting a 30-day deadline for all qualifying entities to report their BOI, March 21, 2025 (see the notice here). That said, there is still some uncertainty as FINCEN also states in its notice that it will further assess its requirements for reporting guidelines prior to the March 21st deadline, and as a result reporting companies may (emphasis on MAY) be granted additional time to comply with their BOI reporting obligations.
In its notice, FINCEN discusses the potential of modifying the reporting requirements to lessen the burden on small business and those less likely to pose a national security threat. So as it stands today, there is a stated March 21st CTA reporting deadline, with an uncertain possibility of a further extension, a potential tweaking of what business entities must report, and to what extent. But for now the guidance is clear that any entity qualifying under the provisions of the CTA must report their BOI by March 21st. Of course that could change again tomorrow. And for additional piling on, note in the FINCEN notice that if an entity has already qualified for some other extension to the reporting deadline (i.e. those affected by a recent natural disaster, etc.) then this new March 21st deadline does not otherwise shorten such extension (see FINCEN notice for more detail).
I encourage you to review FINCEN’s notice. I also encourage you, as I did in my prior post, to gather all of your BOI and ensure you are prepared to report same to FINCEN by the ultimate filing deadline (currently March 21, 2025). But stay tuned as this has been a saga prone to abrupt U-turns. If you are uncertain as to what the CTA is, what it requires and who it applies to, I encourage you to seek professional guidance on the topic. For example, you could contact an attorney like me (hey, that’s convenient).
Conduct yourself accordingly!