Another curveball has been thrown in the never-ending back-and-forth surrounding the rollout of the Corporate Transparency Act (CTA). As detailed in our prior client memo, a federal district court in Texas[1] issued a nationwide preliminary injunction against enforcement of the CTA reporting regulations after a similar injunction issued by another federal district court in Texas was stayed by the U.S. Supreme Court (SCOTUS).[2] Relying on SCOTUS's order in Tex. Top Cop Shop v. McHenry, on February 18, 2025, the trial judge in Smith v. U.S. Dept. of the Treasury granted the government's requested stay of its earlier order, meaning that the CTA's implementing regulations are again in effect.
In light of the district court judge's order, FinCEN released an update on February 19, 2025, noting that reporting companies are once again required to file beneficial ownership information reports (BOIRs) with FinCEN. The update also extended the reporting deadline for certain reporting companies, as set forth in the table below.
Who Is Affected? |
Revised Reporting Deadline |
|
Reporting companies created or registered before January 1, 2024 |
March 21, 2025 |
|
Reporting companies that qualify for disaster relief under prior FinCEN guidance and have extended deadlines |
March 21, 2025, or later deadline[3] |
|
"Plaintiffs in National Small Business United v. Yellen, No. 5:22-cv01448 (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)" |
Not currently required to report |
Regarding the March 21, 2025, deadline, FinCEN recognized that "the vast majority of reporting companies" would be covered by this deadline. FinCEN highlighted that the deadline is subject to further modification and that "FinCEN will provide an update" before enacting any deadline modifications. In spite of the uncertainty of this March 21, 2025, deadline, we recommend that reporting companies file their BOIR by or before this date.
FinCEN noted in its February 19 alert that it 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. The scope and degree of these proposed revisions remain to be seen, but FinCEN has at least signaled a desire to revise the BOI reporting rule.
[1] See Smith v. U.S. Dept. of the Treasury, 2025 WL 41924 (E.D. Tx., Jan 7, 2025).
[2] See McHenry v. Tex. Top Cop Shop, No. 24A653, 2025 U.S. LEXIS 424 (Jan. 23, 2025).
[3] Another potential deadline affects reporting companies created in 2024. If they were created in late 2024, they had a 90-day reporting deadline (now 30 days for reporting companies formed in 2025 and later). For example, would a reporting company created on December 31, 2024, have until March 31, 2025 (i.e., 90 days later) to submit its initial BOIR?