** IMPORTANT CTA UPDATE **
December 24, 2024
In our December 5 Newsletter, we reported that on December 3, 2024, the U.S. District Court for the Eastern District of Texas issued a preliminary injunction, enjoining the implementation and enforcement of the Corporate Transparency Act, 31 U.S.C. § 5336 (CTA), which requires companies doing business in the US to disclose information to FinCEN about their beneficial owners. See Texas Top Cop Shop, Inc., et al v. Garland et al, No. 4:2024cv00478 – Doc 30 (E.D. Tex. 2024).
Yesterday, however, the Fifth Circuit Court of Appeals stayed the District Court’s ruling, effectively reversing it. Texas Top Cop Shop, Inc., et al v. Garland et al, No. 24-4-792 – Doc 140-2 (December 23, 2024). Hence, companies are now, again, required to comply with the CTA’s regulations and report details of their beneficial ownership. They can do so at https://boiefiling.fincen.gov.
Fortunately, given the confusion caused by the issuance of the District Court’s ruling followed by its reversal on appeal, FinCEN issued a notice immediately after the Court of Appeals’ decision, extending the filing deadline (from January 1, 2024) until January 13, 2025, for most companies that were created or registered prior to January 1, 2024. More details can be found at https://fincen.gov/boi.
In Summary:
The decision of the Fifth Circuit Court of Appeals once more requires compliance with the CTA’s reporting mandate but the deadline for that compliance is extended to January 13, 2025 for most companies. Still, as we said before, stay tuned. The Plaintiffs in Texas Top Cop Shop have already asked the Fifth Circuit to reconsider its ruling; and if they do not prevail, they will likely appeal to the U.S. Supreme Court.
If you have any questions or would like additional information, please contact us. Also, as a reminder, we are available to advise and assist with all your business and real estate needs.
Contact Zand & Fine for seamless communication and trusted expertise in both business and real estate law. Learn more here.
Note: While our office does not handle the above filings directly, we can connect you with a company that does.
