Corporate Transparency Act: Reporting Obligations On Hold Once Again
December 31, 2024
CORPORATE TRANSPARENCY ACT:
REPORTING OBLIGATIONS ON HOLD ONCE AGAIN
The reporting required by the Corporate Transparency Act, 31 USC § 5336 (the “Act”) has been put on hold again. On December 26, 2024, a different panel of the U.S. Court of Appeals for the Fifth Circuit reinstated the preliminary injunction enjoining enforcement of the Act. This reverses the decision issued on December 23, 2024 and means that “reporting companies” under the Act will not have to file with the Financial Crimes Enforcement Network (“FinCEN”) for the time being.
FinCEN has reissued its prior guidance as follows:
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.
While the reporting required by the Act has been put on hold for now, the Fifth Circuit has expedited the appeal of the hearing on the merits of the case and oral argument is scheduled for March 25, 2025, so there will be more updates to come in the near future.
We will continue to monitor developments in this case.