The Treasury Department’s Financial Crimes Enforcement Network has extended the deadline for beneficial ownership information reporting after an injunction against it was lifted by a federal appeals court.
On Monday, the U.S. Court of Appeals for the Fifth Circuit granted a stay of a preliminary injunction by a federal district court in Texas that had temporarily paused a requirement for filing BOI reports with FinCEN under the Corporate Transparency Act of 2019 in the case of Texas Top Cop Shop Inc. v. Garland. That means most companies are once again subject to the requirement for reporting their true owners to FinCEN, except for members of the National Small Business Association, which had won an earlier lawsuit over the requirement. The law aims to deter criminals from using shell companies for illicit purposes such as money laundering and terrorism financing.
However, after all the legal back and forth, the Treasury Department
Reporting companies created or registered in the U.S. on or after Sept. 4, 2024, that had a filing deadline between Dec. 3, 2024, and Dec. 23, 2024, have until Jan. 13, 2025, to file their initial beneficial ownership information reports with FinCEN.
Reporting companies created or registered in the U.S. on or after Dec. 3, 2024, and on or before Dec. 23, 2024, have an additional 21 days from their original filing deadline to file their initial beneficial ownership information reports.
Reporting companies that qualify for disaster relief may have extended deadlines that fall beyond Jan. 13, 2025. These companies should abide by whichever deadline falls later.
Reporting companies that are created or registered in the U.S. on or after Jan. 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.
FinCEN did note the exception for members of the NSBA: “As indicated in the alert titled “
FinCEN also provided some background on the lawsuit, pointing out that Tues., Dec. 3, 2024, in the case of Texas Top Cop Shop Inc., et al. v. Garland, et al., No. 4:24-cv-00478 (E.D. Tex.), the U.S. District Court for the Eastern District of Texas, Sherman Division, issued an order granting a nationwide preliminary injunction. On Dec. 23, 2024, the U.S. Court of Appeals for the Fifth Circuit granted a stay of the district court’s preliminary injunction enjoining the Corporate Transparency Act entered in the case of Texas Top Cop Shop Inc. v. Garland, pending the outcome of the Department of the Treasury’s ongoing appeal of the district court’s order. It pointed out that the Texas Top Cop Shop case is only one of several cases that have challenged the CTA pending before courts around the country. Several district courts have denied requests to enjoin the CTA, ruling in favor of the Treasury Department.
“The government continues to believe — consistent with the conclusions of the U.S. District Courts for the Eastern District of Virginia and the District of Oregon — that the CTA is constitutional,” said FinCEN. “For that reason, the Department of Justice, on behalf of the Department of the Treasury, filed a notice of appeal on Dec. 5, 2024 and separately sought a stay of the injunction pending that appeal with the district court and the U.S. Court of Appeals for the Fifth Circuit.”
However, that may change next year when the Trump administration takes office given the deregulation promised by President-elect Trump on the campaign trail.
The American Institute of CPAs has advocated for extending the reporting deadline. A provision for delaying the deadline had been included last week in one of the continuing resolutions to keep the government open, but the version that ultimately passed in Congress over the weekend omitted it.
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