The Corporate Transparency Act is Back On--Immediate Action Required!

On December 3, 2024, a federal district court enjoined enforcement of the Corporate Transparency Act (CTA), giving business owners temporary relief from compliance. However, that relief was short-lived. On December 23, 2024, the Fifth Circuit Court of Appeals entered an order lifting the temporary injunction. That means business owners are again required to comply with the CTA and the deadlines to comply are short.

The CTA, which went into effect on January 1, 2024, requires most entities (corporations, LLCs, etc.) created through a filing with the secretary of state to register with a federal agency known as FinCEN (the Financial Crimes Enforcement Network). Entities formed after January 1, 2025, are required to file a Beneficial Ownership Information Report (BOIR) at the time they are created. Entities formed prior to January 1,2024 are now required to file a BOIR on or before January 13, 2025. The original deadline for compliance was January 1, 2025, but FinCEN has extended the deadline in response to the ruling by the Fifth Circuit Court of Appeals.

What does this all mean for entities subject to the CTA?

1. If you previously filed a BOIR with FinCEN for your entity or entities, there is nothing you need to do. The existing filing is valid, and you are in compliance with the CTA regardless of what happens in the court proceedings.
2. If you have not yet made the required filing, you need to take action to complete the BOIR by January 13,2025. The potential penalties for failing to comply are severe.
3. We remain available to assist you in making the BOIR filing for existing entities. If you desire our assistance, please contact us as soon as possible as the deadline is fast approaching.

We will continue to closely monitor the situation as there is potential for additional court action in the future. If you have questions or for assistance in filing the BOIR, please contact our CTA compliance team at BOI@remboltlawfirm.com or contact your regular Rembolt Ludtke attorney.

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