CTA Enforcement Injunction Lifted; Reporting Deadline Extended to March 21, 2025, for Reporting Companies

On February 18, 2025, the United States District Court for the Eastern District of Texas lifted the preliminary injunction it previously granted in Smith v. U.S. Department of the Treasury, which temporarily enjoined Corporate Transparency Act (“CTA”) enforcement nationwide. This is the second nationwide preliminary injunction to be lifted regarding CTA enforcement, as the United States Supreme Court lifted the preliminary injunction granted in Texas Top Cop Shop, Inc. v. Garland in January 2025.

On February 19, 2025, the Treasury Department’s Financial Crimes Enforcement Network (“FinCEN”) announced March 21, 2025, as the new deadline for reporting companies to file an initial, updated and/or corrected beneficial ownership information report (“BOI Report”). This date is expected to be the applicable deadline for the vast majority of reporting companies. Certain reporting companies that were previously given a reporting deadline later than March 21, 2025, may file their BOI Report by the later deadline (for example, if a reporting company qualified for certain disaster relief extensions).

FinCEN also stated that it will use this 30-day extension to assess its options to further modify reporting deadlines, while prioritizing reporting for those reporting companies that pose the most significant national security risks, and that it intends to initiate a process to revise the reporting rules in 2025 to reduce the compliance burden for low-risk small businesses. However, the FinCEN announcement did not give any further details regarding these potential modifications and revisions.

In light of the CTA enforcement injunction being lifted, we recommend reporting companies prepare for CTA compliance and submit their respective BOI Report as soon as practicable and no later than March 21, 2025. Hodgson Russ will continue monitoring CTA developments, including further developments in the ongoing CTA litigation and any efforts in the new U.S. Congress to repeal the CTA and/or extend reporting deadlines.[1]

Disclaimer:

This client alert is a form of attorney advertising. Hodgson Russ LLP provides this information as a service to its clients and other readers for educational purposes only. Nothing in this client alert should be construed as, or relied upon, as legal advice or as creating a lawyer-client relationship.

[1] For more information, please see our previous client alerts, “Reporting Requirements Under the Corporate Transparency Act: How Does it Affect My Company?”, “Corporate Transparency Act: FinCEN Updates and Guidance Ahead of January 1, 2024 Effective Date,” “Corporate Transparency Act Enforcement Enjoined by Preliminary Injunction,” “Corporate Transparency Act Enforcement Injunction Lifted by Fifth Circuit; Reporting Deadline Extended to January 13, 2025,” and “Corporate Transparency Act Enforcement Injunction Reinstated by Fifth Circuit."