Corporate Transparency Act Update: New compliance deadline is March 21
Late last year, we reported that a nationwide preliminary injunction blocked enforcement of the Corporate Transparency Act (CTA). Since then, multiple cases challenging the constitutionality of the CTA have been moving through the courts.
On February 18, 2025, the U.S. District Court for the Eastern District of Texas in Smith, et al. v. U.S. Department of the Treasury, et al., 6:24-cv-00336 (E.D. Tex.) lifted the final nationwide injunction then in effect preventing the U.S. Department of Treasury’s Financial Crimes Enforcement Network (FinCEN) from enforcing the CTA. As such, beneficial ownership information (BOI) reporting requirements under the CTA are once again back in effect.
FinCEN extended the filing deadline 30 days to provide reporting companies additional time to submit their initial, updated, and/or corrected BOI reports. While FinCEN noted it is assessing ways to reduce the regulatory burden on lower-risk companies, there is no certainty that there will be additional relief provided prior to the March 21 deadline. Companies should promptly assess their reporting obligations and submit BOI reports, if applicable, to avoid potential penalties.
Reporting companies have until March 21, 2025 to comply
On February 10, 2025, the House of Representatives unanimously approved H.R. 736, a bill that would extend the reporting deadline under the CTA for entities formed prior to January 1, 2024. The bill was received by the Senate, read twice, and referred to the Senate Committee on Banking, Housing, and Urban Affairs, but no timeline has been provided with respect to the Senate’s response to the bill.
As this litigation and Congressional actions unfold, we will continue to closely monitor and keep our clients apprised of any developments impacting the enforcement of the CTA. If you have any questions about your company’s compliance with the CTA or need assistance in filing BOI reports, please contact your McDonald Hopkins attorney.
