BOI Filing Requirement is Halted Again
In the latest twist in the ongoing legal saga surrounding the Corporate Transparency Act (CTA), the U.S. Court of Appeals for the Fifth Circuit issued a critical ruling on December 26, 2024, vacating a previous stay and (reinstating the nationwide preliminary injunction that halts enforcement of the CTA and its associated Reporting Rule. This action pauses the imminent filing deadlines for beneficial ownership information (BOI) reports, meaning Reporting Companies formed or registered prior to 2024 are no longer required to file by the previously set January 13, 2025, deadline.
A Timeline of Key Events
December 3, 2024: The U.S. District Court for the Eastern District of Texas entered an order enjoining enforcement of the CTA and its corresponding Reporting Rule, effectively blocking the requirement for businesses to file their beneficial ownership information with FinCEN.
December 5, 2024: The U.S. government filed a Notice of Appeal in response to the district court’s order.
December 6, 2024: FinCEN issued an update on its BOI webpage, announcing that due to the federal court order, businesses are not required to file beneficial ownership information and will not face penalties for non-compliance while the order remains in effect. However, businesses were still allowed to voluntarily submit reports.
December 11, 2024: The government filed a Motion to Stay the Injunction with the district court, seeking to reverse the block on CTA enforcement.
December 13, 2024: An emergency motion was filed with the Fifth Circuit Court of Appeals to stay the district court’s nationwide injunction.
December 17, 2024: The district court denied the motion, prompting the government to appeal.
December 23, 2024: A motions panel of the Fifth Circuit granted the government’s emergency motion to stay the injunction, expediting the appeal process. This decision led FinCEN to announce a temporary postponement of reporting deadlines.
December 24, 2024: Plaintiffs petitioned the Fifth Circuit for an emergency rehearing en banc, seeking a reversal of the stay and requesting a decision by January 6, 2025.
December 26, 2024: The Fifth Circuit vacated the order that had granted the government’s stay, effectively reinstating the injunction. The court explained that its decision aimed to preserve the constitutional status quo while the court considers the merits of the appeal. This means that Reporting Companies do not have to comply with CTA filing requirements for the time being.
December 27, 2024: An expedited briefing schedule was set for the upcoming appeal, with key dates including:
- February 7, 2025: Government’s brief due
- February 21, 2025: Plaintiffs’ brief due
- February 28, 2025: Government’s reply brief
- March 25, 2025: Oral argument scheduled
What Does This Mean for Reporting Companies?
As it stands, Reporting Companies—entities required to disclose their beneficial ownership information under the CTA—are not obligated to file their initial or updated BOI reports at this time. This includes companies that were due to submit their reports by January 13, 2025, under an extension granted by FinCEN. With the preliminary injunction reinstated, businesses may delay filing until the Fifth Circuit issues its final decision on the appeal.
However, voluntary filings remain permissible. Businesses wishing to submit their BOI reports before a final decision is made may still do so.
Stay tuned for updates as we continue monitoring this evolving situation.
