The Corporate Transparency Act (CTA) originally required businesses to report beneficial ownership information (BOI) to the federal government by January 1, 2025. This law was part of the Anti-Money Laundering Act of 2020, designed to prevent financial crimes through anonymous business structures. However, recent court decisions have temporarily halted this requirement nationwide.
The law’s implementation has experienced several dramatic turns through the court system. Most notably, a Texas court issued a nationwide pause on enforcement, which was later overturned, then reinstated, and finally addressed by the Supreme Court on January 23, 2025. During this period, Financial Crimes Enforcement Network (FinCEN) adjusted reporting deadlines multiple times to accommodate these legal changes.
Quote from the FINCEN website:
“In light of a recent federal court order, reporting companies are not currently required to file beneficial ownership information with FinCEN and are not subject to liability if they fail to do so while the order remains in force. However, reporting companies may continue to voluntarily submit beneficial ownership information reports.”
To add to the confusion, there is action in the legislative branch to repeal the CTA. Rep. Warren Davidson (R-OH) re-introduced the “Repealing Big Brother Overreach Act” in the House of Representatives a couple of weeks ago. Sixty-eight House colleagues are providing support. U.S. Senators Rand Paul (R-KY) and Tommy Tuberville (R-AL) have also introduced a Senate companion bill of the same name. The goal of these bills is to repeal the CTA.
Currently, while the reporting requirement technically exists, enforcement remains suspended due to ongoing legal challenges. Businesses can voluntarily submit their ownership information but cannot be penalized for not doing so at this time. However, given the fluid nature of this situation, business owners should stay informed about updates and prepare their ownership information to be ready when enforcement resumes. The best approach is to gather the necessary documentation while monitoring developments through reliable legal channels.
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