By Eric D. Morton
As I reported earlier this year, the Corporate Transparency Act (CTA) took effect on January 1, 2024. Under the CTA, companies must provide key details about their beneficial owners by January 1, 2025, by filing a Beneficial Ownership Information (BOI) report.
However, on December 3, 2024, the U.S. District Court for the Eastern District of Texas issued a nationwide preliminary injunction temporarily blocking enforcement of the CTA and the associated BOI reporting rules. The court’s ruling paused the requirement that reporting companies submit beneficial ownership information to the Financial Crimes Enforcement Network (FinCEN) by the January 1, 2025 deadline.
What does this mean for businesses?
At this time, compliance with BOI reporting requirements will not be enforced. However, this injunction is temporary and could be overturned on appeal.
Here are some key steps your company can take:
- Keep tabs on the situation – Stay up-to-date about developments in this case.
- Be prepared – If the order is overturned, your company should be able to file its BOI report promptly to meet future compliance obligations.
- Voluntarily submit – BOI reporting will not be enforced at this time, but it’s a good idea to go ahead and file now. BOI reports continue to be accepted on the FinCEN site.
Of course, we’ll be keeping close tabs on the situation ourselves and will reach out if anything changes. Please feel free to contact us if you have any questions about BOI reporting or this ruling. We are here to help your business navigate the evolving landscape.
Eric D. Morton is the principal attorney at Clear Sky Law Group, P.C. and can be reached at 760-722-6582, 510-556-0367, and emorton@clearskylaw.com