Corporate Transparency Act Update

The Corporate Transparency Act will remain temporarily blocked pending the Department of Justice's appeal of the nationwide injunction put in place by a federal court in early December.  

The Justice Department as filed an appeal to the US Court of Appeals for the Fifth Circuit to stay the District Court's order, which stops the Treasury Department from enforcing the CTA's Beneficial Ownership Information Reports. The law requires that existing US business entities disclose their beneficial owners' identities to FinCEN, a division of the Treasury Department, by Jan. 1, 2025.  

While FinCEN has acknowledged BOIRs are not mandatory during the injunction period, companies can continue to file voluntarily.  

For now, it may be in the best interest of privately owned businesses to continue to analyze their ownership and control structure, collect relevant ownership information, and be prepared to file quickly if the Department of Justice is successful in having the nationwide preliminary injunction stayed.  

It is important to note that all other injunctions involving the CTA have been limited in their scope and have been decided in favor of upholding the CTA. Lastly, if injunction were to be lifted before the January 1, 2025, deadline, businesses that have not filed their BOI Reports likely will be subject to late reporting penalties.  

Pease Bell will not be able to assist with filing BOI reports required under the CTA, but would be happy to refer you to legal professionals who can assist with filing.