December has been an eventful month for Corporate Transparency Act (CTA) compliance.[1] A quick recap of significant December events:
- On December 3, 2024, Judge Amos L. Mazzant of the United States District Court for the Eastern District of Texas, Sherman Division[2] issued a nationwide, preliminary injunction against the enforcement of the CTA.
- Mid-afternoon on December 23, 2024, the United States Court of Appeals for the Fifth Circuit stayed the Eastern District of Texas’ nationwide preliminary injunction reinstating the CTA, and by implication, the December 31, 2024 compliance deadline for reporting companies formed before January 1, 2024.[3]
- Later in the evening of December 23, 2024, FinCEN extended certain compliance deadlines because of the injunction and its subsequent stay by the Fifth Circuit.[4]
Specifically, FinCEN granted the following deadline extensions:
- Reporting companies formed prior to January 1, 2024, have until January 13, 2025, to file their initial beneficial ownership information reports.
- Reporting companies formed from September 3, 2024, through September 24, 2024, have until January 13, 2025, to file their initial beneficial ownership information reports.
- For reporting companies formed on or after December 3, 2024, FinCEN tolled their reporting deadline giving them an additional 21 days to file their initial beneficial ownership information reports.
No extension was granted to any reporting company formed from September 25, 2024 to December 2, 2024 or from December 24, 2024 to December 31, 2024. As such, those companies need to file their initial beneficial ownership report within ninety (90) days of their formation date.
In short, all reporting companies should move forward promptly with their beneficial ownership reports.
Williams Mullen will continue to monitor the impact of this ruling, subsequent action by this court, and any ensuing appeals along with FinCEN’s implementation of the CTA, and we will provide updates and alerts when warranted.
[1] The CTA was enacted into law on January 1, 2021, as part of the Anti-Money Laundering Act of
2020. See, William M. (Mac) Thornberry National Defense Authorization Act for Fiscal Year 2021,
Pub. L. 116-283, 134 Stat. 3388 §§ 6001-6511 (2020).
[2] Texas Top Cop Shop, Inc., et al., v. Merrick Garland, Attorney General of the United States, et al.,
Civil Action No. 4:24-CV-478 (December 3, 2024, E.D. Texas). A copy of the court’s order is available
here.
[3] Texas Top Cop Shop, Inc., et al., v. Merrick Garland, Attorney General of the United States, et al.,
Civil Action No. 4:24-CV-478 (December 23, 2024, 5th Circuit). See a copy of the Fifth Circuit’s order
here.
[4] See FinCEN Release located here.
