Federal Appeals Court Reinstates Corporate Transparency Act, Filing Deadline Extended to January 13
A federal appellate court has issued a stay on the nationwide injunction temporarily halting enforcement of the Corporate Transparency Act (CTA). The court’s decision effectively reverses a lower court’s December 3 injunction and reinstates the reporting requirements for millions of U.S. companies. In response the U.S. Financial Crimes Enforcement Network (FinCEN) has extended key filing deadlines to accommodate businesses affected by the earlier injunction.
The Fifth Circuit Court of Appeals ruled that the federal government is likely to succeed in defending the constitutionality of the CTA, part of the Anti-Money Laundering Act of 2020 that mandates reporting of beneficial ownership information (BOI) by corporations, LLCs, and other entities.
Revised Filing Deadlines
To mitigate disruptions and confusion caused by the injunction, FinCEN has updated their compliance deadlines:
The CTA, a cornerstone of the Anti-Money Laundering Act of 2020, aims to combat financial crimes, such as money laundering and tax evasion, by requiring non-exempt businesses to disclose their beneficial owners to FinCEN. The act faced legal challenges, including a recent case in Texas that resulted in the now-overturned injunction.
What’s Next?
The expedited appeal process ordered by the court will determine the long-term viability of the CTA’s requirements. Businesses are urged to stay informed and consult legal advisors to ensure timely compliance with the changing deadlines.
The updated filing deadlines reflect FinCEN’s recognition of the operational challenges posed by these legal developments and aim to support smooth implementation of the law.
NCBA will keep its members informed of future developments. For additional information and resources, visit FinCEN’s website or consult your legal counsel.
The Fifth Circuit Court of Appeals ruled that the federal government is likely to succeed in defending the constitutionality of the CTA, part of the Anti-Money Laundering Act of 2020 that mandates reporting of beneficial ownership information (BOI) by corporations, LLCs, and other entities.
Revised Filing Deadlines
To mitigate disruptions and confusion caused by the injunction, FinCEN has updated their compliance deadlines:
- Existing entities formed or registered before January 1, 2024, now have until January 13, 2025, to file their initial BOI reports, a two-week extension from the original January 1 deadline. (Companies registered between January 1, 2024, and September 3, 2024, were required to submit their BOI reports by their original deadlines.)
- Entities formed or registered between September 4, 2024, and December 23, 2024, whose deadlines were impacted by the injunction also have until January 13, 2025, to file.
- Entities formed or registered between December 3, 2024, and December 23, 2024, have an additional 21 days beyond their original filing deadlines.
- Entities formed or registered after January 1, 2025, must comply with the standard 30-day filing requirement.
- Companies eligible for disaster relief may adhere to extended deadlines beyond January 13, 2025, as applicable.
The CTA, a cornerstone of the Anti-Money Laundering Act of 2020, aims to combat financial crimes, such as money laundering and tax evasion, by requiring non-exempt businesses to disclose their beneficial owners to FinCEN. The act faced legal challenges, including a recent case in Texas that resulted in the now-overturned injunction.
What’s Next?
The expedited appeal process ordered by the court will determine the long-term viability of the CTA’s requirements. Businesses are urged to stay informed and consult legal advisors to ensure timely compliance with the changing deadlines.
The updated filing deadlines reflect FinCEN’s recognition of the operational challenges posed by these legal developments and aim to support smooth implementation of the law.
NCBA will keep its members informed of future developments. For additional information and resources, visit FinCEN’s website or consult your legal counsel.