New Federal Reporting Obligations for Business Entities

Important Update: Impact of Ongoing Litigation Regarding the Corporate Transparency Act

You may recall our previous posts regarding the Corporate Transparency Act (“CTA”), a federal law that requires all foreign and domestic corporations, LLCs, limited partnerships, and other entities created through a government filing to identify and provide personal information for key personnel – any individual who owns a 25% or greater ownership interest in, or who exercises substantial control over, the company — by filing a beneficial ownership information (“BOI”) report with the Financial Crimes Enforcement Network (“FinCEN”).

The CTA would have required reporting companies to file BOI reports by January 1, 2025. However, there have been back-and-forth court rulings delaying enforcement of the CTA, beginning with a nationwide injunction issued by the U.S. District Court for the Eastern District of Texas on December 3, 2024, which set aside the Jan. 1 reporting deadline. A panel of the U.S. Court of Appeals for the Fifth Circuit then issued an order on December 23, 2024, lifting the nationwide injunction.

The latest decision issued by the U.S. Court of Appeals for the Fifth Circuit on December 26th reinstated the nationwide injunction by vacating the Dec. 23 order. Therefore, the CTA’s compliance deadline is frozen and companies are not required to report beneficial ownership information with FinCEN.

The appeals process is ongoing. While the Fifth Circuit has scheduled oral argument for March 25, 2025, the U.S. Department of Justice has asked the U.S. Supreme Court to halt the nationwide injunction during appeal.

Given these rapid developments, companies should consider filing on a voluntary basis or preparing to file within a short period of time if the reporting requirements are reinstated.

We will attempt to keep you updated as this evolves through additional posts like this one.

DISCLAIMER: We do not assume responsibility for your company’s ongoing compliance obligations under the CTA unless we are separately engaged in the future to assist with specific filings.

We are here to help.

If you have any questions about the Corporate Transparency Act, please reach out to Shea GuntherMaher, Associate Attorney, at (617) 716-0300 or by email to [email protected].


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