Another CTA Turn: One Beneficial Ownership Information Filing Stay Lifted, But Another Remains
Lucas P. Sczygelski , Jeff Storch | 01.24.25
On January 23, 2025, the U.S. Supreme Court granted the federal government’s request to stay a nationwide injunction against enforcing the Corporate Transparency Act (CTA) and its beneficial ownership information (BOI) reporting requirements. The injunction originally was issued by a federal judge in Texas (Texas Top Cop Shop, Inc. v. McHenry—formerly, Texas Top Cop Shop v. Garland).
However, as noted in a subsequent alert from the Financial Crimes Enforcement Network (FinCEN) (available at https://fincen.gov/boi), a separate nationwide order issued in a different case (Smith v. U.S. Department of the Treasury) remains in place. Therefore, FinCEN has announced that despite the Supreme Court’s action in Texas Top Cop Shop, reporting companies still are not currently required to file BOI or subject to liability if they fail to file — at least while the Smith order remains in force. But FinCEN will continue to allow reporting companies to voluntarily report BOI.
As we have written about before (see our CTA Whiplash article), the CTA was set to impose various reporting requirements on most U.S. entities, with many entities facing a January 1, 2025, filing deadline. There have been several legal challenges and resulting changes in the reporting requirements, with more changes possible.
For now, entities should be prepared to comply with the CTA’s reporting requirements if they are reinstated, but no immediate action is necessary as a result of the Supreme Court’s Texas Top Cop Shop ruling.
If you have questions about what this latest CTA ruling means for you and your entities, please contact the primary Boardman Clark attorney with whom you work or call us at (608) 257 9521 to speak with one of our business attorneys.
DISCLAIMER: The information provided is for general informational purposes only. This post is not updated to account for changes in the law and should not be considered tax or legal advice. This article is not intended to create an attorney-client relationship. You should consult with legal and/or financial advisors for legal and tax advice tailored to your specific circumstances.