The Financial Crimes Enforcement Network (FinCEN) has confirmed that the Corporate Transparency Act’s (CTA) beneficial ownership information (BOI) reporting requirements are once again in effect. Following recent legal developments, FinCEN has extended the CTA BOI reporting deadline by 30 calendar days from February 19, 2025. Most companies now have until March 21, 2025, to comply with the CTA BOI reporting requirements.
CTA Legal Challenges: A Battle Over Privacy and Government Intrusion
The CTA has faced multiple legal challenges that temporarily delayed enforcement of its BOI reporting requirements. Initially, a nationwide preliminary injunction against the CTA was issued in Texas Top Cop Shop, Inc. v. Bessent by the U.S. District Court for the Eastern District of Texas. However, in early January 2025, the Supreme Court of the United States stayed (paused) this injunction, which would have reinstated enforcement of the CTA. Despite this decision, a separate nationwide injunction issued in Smith v. U.S. Department of the Treasury remained in place, continuing to block enforcement of the law.
Following the transition to a new presidential administration, FinCEN moved to have the Smith injunction lifted, citing the Texas Top Cop Shop ruling. On February 17, 2025, the stay was granted, removing the final barrier to CTA enforcement. Consequently, on February 19, 2025, FinCEN issued new guidance and extended the reporting deadline to March 21, 2025.
How We Got Here: The Litigation Timeline
- December 3, 2024: Judge Amos Mazzant of the U.S. District Court for the Eastern District of Texas issued a nationwide preliminary injunction in Texas Top Cop Shop, Inc. v. Garland, halting CTA enforcement.
- December 23, 2024: The Fifth Circuit stayed the Texas Top Cop Shop injunction, reinstating the CTA’s reporting requirements. FinCEN extended the reporting deadline for existing reporting companies to January 13, 2025.
- December 26, 2024: A separate panel of the Fifth Circuit reinstated the nationwide preliminary injunction, again pausing CTA enforcement.
- January 7, 2025: In Smith v. U.S. Department of the Treasury, Judge Jeremy Kernodle of the U.S. District Court for the Eastern District of Texas issued another nationwide injunction, blocking CTA enforcement.
- January 23, 2025: The Supreme Court stayed the Texas Top Cop Shop injunction, reinstating the CTA. However, the Smith injunction remained in effect, further delaying enforcement.
- January 24, 2025: FinCEN clarified that, due to the Smith injunction, reporting companies were not required to file BOI reports and would not be penalized for failing to do so.
- February 17, 2025: The Smith injunction was lifted, enabling full enforcement of the CTA.
- February 19, 2025: FinCEN issued updated guidance, confirming that the CTA BOI reporting requirements were in effect and extending the deadline to March 21, 2025.
Who Must Report? Updated CTA Compliance Deadlines
- New entities: All newly formed nonexempt reporting companies have 30 days from formation to file BOI reports.
- Updates to prior reports: Changes to previously filed reports must be reported within 30 days of the change.
- Entities with lapsed deadlines: Nonexempt reporting companies whose filing deadlines fell during the injunction period now have until March 21, 2025, to submit their reports. This deadline applies to companies that were required to file but did not do so due to the previous injunctions.
- Extensions: Entities qualifying for disaster relief extensions or other extensions must adhere to their respective extended deadlines.
What’s Next for CTA Reporting?
Over the next 30 days, FinCEN may adjust the BOI reporting deadlines further. Additionally, FinCEN has signaled its intent to revise the CTA’s BOI reporting regulations in 2025 to reduce compliance burdens for lower-risk entities, including small businesses.
Meanwhile, litigation over the CTA remains ongoing. Appeals in the Fifth and Eleventh Circuits continue in Texas Top Cop Shop, Smith, and National Small Business United. These cases are unlikely to be resolved before the March 21, 2025, deadline.
In a separate legislative effort, the U.S. House of Representatives recently passed a bill proposing to delay CTA filing deadlines for existing entities until 2026. However, the Senate has yet to act on the bill, making it uncertain whether it will be enacted before the reinstated March 21, 2025, deadline.
What Should Businesses Do Now?
- Prepare for March 21, 2025: Entities required to report BOI should take steps to comply with the deadline, as no further delays have been announced.
- Monitor for Updates: Businesses should stay alert for any FinCEN announcements regarding extensions or modifications to reporting deadlines.
- Understand the Bigger Picture: The CTA remains subject to ongoing litigation, and legislative efforts could still alter current reporting obligations.
Since FinCEN has stated it will provide updates on any deadline modifications before March 21, 2025, reporting companies should identify their beneficial owners and gather required information but may wish to hold off on filing until further FinCEN guidance is issued.
