CTA Enforcement and BOI Report Deadlines – Delayed But Not Dead Yet!
A ruling by a U.S. District Court for the Eastern District of Texas granted a preliminary injunction blocking the U.S. Department of Treasury from enforcing the Corporate Transparency Act (CTA) – including the January 1, 2025 beneficial ownership information (BOI) report filing requirement for companies formed prior to January 1, 2024.
The suit was filed by the National Federation of Independent Businesses (NFIB). The judge justified blocking the enforcement of the BOI reporting requirements nationwide because NFIB’s nearly 300,000 nationwide members were a party to the case.
What does this mean for business owners?
- If you were required to file a BOI Report by January 1, 2025 that deadline is stayed and you are not required to file pending further order.
- If you were required to file or update a BOI Report but had not done so, the enforcement of the CTA, including penalties for noncompliance, may not be enforced.
What happens next?
The U.S. Department of Justice (DOJ) can appeal the preliminary injunction issued by the U.S. District Court for the Eastern District of Texas to the U.S. Court of Appeals for the Fifth Circuit. The DOJ must file an appeal within 60 days after the judgment is entered. See Fed. R. App. P. 4(a). In the event of an appeal, the matter could be headed to the Supreme Court for a final ruling.
PK Law’s Corporate and Real Estate Group will continue to monitor the status of this matter. Business owners who may be affected by subsequent decisions should plan to closely monitor the developments, particularly over the next 60 days.
Please Note: The filing of the Beneficial Ownership Information (“BOI”) Report is the responsibility of the entity and its beneficial owners. PK Law Attorneys will not take any action or file any BOI reports, whether or not currently or previously engaged as an Attorney for the entity or any of the entity’s beneficial owners, unless expressly engaged to do so.
