On the afternoon of December 23, 2024, the U.S. Fifth Circuit Court of Appeals, in an unpublished order, granted the government’s motion to stay the nationwide injunction of the U.S. District Court for the Eastern District of Texas enjoining enforcement of the Corporate Transparency Act (“CTA”). The CTA filing requirement is therefore reinstated.
Later in the evening, FinCEN issued an alert extending the filing dates in light of the Circuit Court’s ruling.
Those dates are as follows:
- Reporting companies that were created or registered prior to January 1, 2024 have until January 13, 2025 to file their initial beneficial ownership information reports with FinCEN. (These companies would otherwise have been required to report by January 1, 2025.)
- Reporting companies created or registered in the United States on or after September 4, 2024 that had a filing deadline between December 3, 2024 and December 23, 2024 have until January 13, 2025 to file their initial beneficial ownership information reports with FinCEN.
- Reporting companies created or registered in the United States on or after December 3, 2024, and on or before December 23, 2024, have an additional 21 days from their original filing deadline to file their initial beneficial ownership information reports with FinCEN.
- Reporting companies that qualify for disaster relief may have extended deadlines that fall beyond January 13, 2025. These companies should abide by whichever deadline falls later.
- Reporting companies that are created or registered in the United States on or after January 1, 2025 have 30 days to file their initial beneficial ownership information reports with FinCEN after receiving actual or public notice that their creation or registration is effective.
- As indicated in the alert titled “Notice Regarding National Small Business United v. Yellen, No. 5:22-cv-01448 (N.D. Ala.)”, Plaintiffs in National Small Business United v. Yellen, No. 5:22-cv-01448 (N.D. Ala.)—namely, Isaac Winkles, reporting companies for which Isaac Winkles is the beneficial owner or applicant, the National Small Business Association, and members of the National Small Business Association (as of March 1, 2024)—are not currently required to report their beneficial ownership information to FinCEN at this time.
The Fifth Circuit’s stay of the District Court’s injunction is “temporary,” pending its decision on the larger question of the constitutionality of the CTA. Numerous amicus curae briefs have been and continue to be filed in opposition to the CTA’s constitutionality. In its ruling, however, the court provided a preview of its constitutionality decision by indicating why and how the government was likely to prevail in its many arguments in support of constitutionality. The court also ordered that the appeal be expedited to the next available oral argument panel.
For questions about this update, please contact Russ Hansen or any member of Prince Lobel’s Business Transactions Group.