The last remaining preliminary injunction blocking enforcement of the CTA on a nationwide basis has now been lifted and the CTA has been reinstated nationwide. On February 17, 2025, in Smith v. U.S. Department of Treasury, a federal judge in the United States District Court for the Eastern District of Texas issued an order staying a preliminary injunction that blocked enforcement of the CTA and its reporting rule on a nationwide basis. This order was made in light of the January 23, 2024 order from the United States Supreme Court staying a preliminary injunction that blocked the CTA and its reporting rule on a nationwide basis under a separate case, McHenry v. Texas Top Cop Shop.
FinCEN issued additional guidance on February 19, 2025, stating:
- Beneficial ownership information (“BOI”) reporting requirements under the CTA are once again back in effect.
- The Department of the Treasury recognizes that reporting companies may need additional time to comply with their BOI reporting obligations, and FinCEN is generally extending the deadline 30 calendar days from February 19, 2025. This means, for the vast majority of reporting companies, the new deadline to file an initial, updated and/or corrected BOI report is now March 21, 2025.
- The Department of Treasury is committed to reducing the regulatory burden on businesses, and during this 30-day period, FinCEN will assess its options to further modify deadlines, while prioritizing reporting for those entities that pose the most significant national security risks.[1]
- FinCEN intends to initiate a process this year to revise the BOI reporting rule to reduce the burden for lower-risk entities, including many U.S. small businesses.
- FinCEN will provide an update before March 21, 2025 of any further modification of this deadline, recognizing that reporting companies may need additional time to comply with their BOI reporting obligations once the update is provided.
While litigation regarding the CTA’s enforceability is ongoing, Congress has been considering legislation to revise aspects of the CTA. On February 10, 2025, the United States House of Representatives unanimously passed the “Protect Small Businesses from Excessive Paperwork Act” that proposes to extend the deadline for certain companies that are required to file BOI with FinCEN.[2] Specifically, if this bill becomes law, companies formed or registered before January 1, 2024, would be required to submit a BOI to FinCEN by January 1, 2026, instead of by January 1, 2025, as required under current regulations. On February 11, 2025, the United States Senate introduced a companion bill, S.505, to amend Title 31, United States Code, to modify the deadline for filing BOI reports for reporting companies formed or registered before January 1, 2024.[3]
Despite the ongoing litigation and the introduction of legislation aimed at relaxing the CTA and its reporting requirements, non-exempt reporting companies should promptly gather necessary BOI and make CTA filings before March 21, 2025, now that the CTA is back in effect.
For more information on the CTA, please refer to our earlier publications (New Corporate Transparency Act Update: Supreme Court of the United States Stays the Preliminary Injunction Blocking Enforcement of the CTA, Fifth Circuit Court Vacates its Stay to the Preliminary Injunction Blocking Enforcement of the CTA, Corporate Transparency Act Update: Fifth Circuit Court Stays Preliminary Injunction Blocking Enforcement of the CTA; FinCEN Issues Updated Guidance, Preliminary Injunction Temporarily Blocks Enforcement of the Corporate Transparency Act, July and September 2024 Update, A Series of the Latest Updates for Reporting Companies, and The Corporate Transparency Act: A New Federal Disclosure Requirement for Certain Entities) or FinCEN’s small business resource webpage for beneficial ownership information (available here). If you would like assistance with and/or have questions regarding CTA compliance or filings, please contact Aaron Kacer or Steve Lawrence.
[1] FinCEN has not provided any guidance as to which entities pose the most significant national and security risks.
[2] H.R. 736 – 119th Congress (2025-2026), sponsored by Rep. Nunn, Zachary (R-IA-3).
[3] S.505 – 119th Congress (2025-2026), sponsored by Sen. Scott, Tim (R-SC).
