On December 26, 2024, a merits panel of the United States Court of Appeals for the Fifth Circuit contributed to the frenzied whirlpool of Corporate Transparency Act (CTA) developments, reversing an earlier decision to stay the preliminary injunction issued by the Eastern District of Texas suspending enforcement of the CTA and its reporting rules. With the government’s stay removed, businesses—once again—do not need to file beneficial ownership information (BOI) reports with the Financial Crimes Enforcement Network (FinCEN) while the order is in effect.
In vacating the stay, the Fifth Circuit stated it has an interest in “[preserving] the constitutional status quo” while the court weighs the parties’ substantive arguments. Oral arguments are scheduled for March 25, 2025. FinCEN has released a statement confirming that businesses will not be subject to liability for failing to file BOI reports while the order remains in effect. However, reporting companies are free to voluntarily submit such reports to FinCEN during this time.
Even if reporting companies choose not to voluntarily file BOI reports while the injunction is in place, they may, to the extent they have not already, gather information that may be required to file the BOI reports with FinCEN when and if the injunction is lifted or the government is successful in its appeal.
Further information on the CTA and step-by-step videos on how to file a BOI report and apply for a FinCEN identification number are available at our CTA Resource Center.