A federal court has issued a nationwide injunction halting enforcement of the Corporate Transparency Act (CTA). This ruling comes just weeks before the law’s beneficial ownership reporting deadline was set to pass.
The CTA would have required most companies to report detailed ownership information to the Financial Crimes Enforcement Network (FINCEN) by January 1, 2025. However, following a legal challenge, the court has suspended enforcement of these requirements. As a result, this reporting deadline is now postponed until further notice from the court, and no beneficial ownership reports need to be filed at this time.
Over the weekend, FinCEN released additional guidance providing clarity on the impact of the court order. The guidance provides that: “In light of a recent federal court order, reporting companies are not currently required to file beneficial ownership information with FinCEN and are not subject to liability if they fail to do so while the order remains in force. However, reporting companies may continue to voluntarily submit beneficial ownership information reports.”
So, for now, this ruling means that you do not have to file anything relating to the CTA by the original December 31, 2024 deadline. Voluntary filings are permitted but not required. We will continue monitoring this litigation closely and will inform you of any significant developments that could affect reporting requirements.
For any questions on how this development impacts your specific situation, please contact the Rupp Pfalzgraf Business Law team.
