This week, the United States District Court for the Eastern District of Texas issued a nationwide preliminary injunction halting the enforcement of the Beneficial Ownership Information reporting requirements mandated by the Corporate Transparency Act (CTA). (Texas Top Cop Shop v. Garland (December 3, 2024) U.S. Dist. Ct., Eastern Dist. Of Texas, Case No. 4:24-CV-478)
The court ruled the Corporate Transparency Act’s reporting requirement was unconstitutional and granted the injunction prohibiting FinCEN from enforcing the January 1, 2025 reporting deadline for all reporting companies.
The court’s ruling may be appealed, so the regulatory landscape could change very quickly depending on the procedural tactics taken in the litigation.
For now, businesses are not required to file beneficial ownership information reports with FinCEN. However, at the time of writing, FinCEN’s online filing system continues to be operative if companies wish to submit the beneficial ownership information.
We will provide additional updates as information becomes available. As always, we are ready to guide you along the best path as you navigate these changes and their impact on your business.