The Corporate Transparency Act (CTA) enacted in 2021 mandates certain reporting businesses operating in the United States to report information about the individuals who own and/or control them. The act was intended to address & safeguard against the following:

• Money Laundering
• Terrorism Financing
• Other Forms of Illegal Financing

Initially, the following deadlines for filing a BOIR were as follows:

• EXISTING REPORTING COMPANIES (formed/registered before 01/01/24)
• Must report information no later than 01/01/25
• NEW REPORTING COMPANIES (formed/registered on or after 01/01/24)
• Must report information no later than 90 days after formation/registration

There were several court cases filed up challenging the requirement to file BOIRS throughout the country; many of those motions were denied. However, in National Small Business United v. Yellen, No. 5:22-cv-01448 (N.D. Ala.), an Alabama federal distribution court ruled the CTA unconstitutional as it was originally drafted. This ruling, unfortunately for most, only applied to the plaintiffs in the case, and all other reporting companies were still required to report the necessary information by the prescribed deadlines.

December 3, 2024: A district court issued an injunction which temporarily blocked the U.S. government from enforcing the CTA while the case was being decided. In response, the government asked the district court to pause the injunction, thus making the law enforceable during the legal process; this request was denied.

December 23, 2024: The U.S. government’s appeal for an emergency stay of the injunction which was appealed to a higher court was granted. This reinstated the CTA, thus, making it enforceable while the appeal continued; the appeal process was also expedited.

December 26, 2024: A new panel of judges reviewed the situation & decided the cancel the earlier decision that allowed the U.S. government to enforce the CTA. In essence, this decision meant that the district’s court injunction became effective; the government could not enforce the CTA; and reporting companies were no longer required to file a BOIR.

January 2, 2025: The U.S. Department of Justice filed an emergency motion with the U.S. Supreme Court asking it to overturn the most recent injunction and to reimpose the January 13, 2025 filing date for affected reporting companies.

January 13, 2025: The U.S. Supreme Court has not issued a decision. Therefore, reporting companies are not currently required to file a BOIR and are not subject to liability while the current stay is in place.

Reporting companies can voluntarily file this report, however, we do not recommend doing so at this time.

We will keep you apprised of any updates to the ongoing litigation as information is made available to us. In the meantime, you can click here for a summary of the CTA.