Corporate Transparency Act: Fifth Circuit Lifts Nationwide Injunction, FinCEN Extends Filing Deadlines

A divided motions panel of the US Court of Appeals for the Fifth Circuit granted the US government’s request for an emergency stay of a nationwide preliminary injunction against the government’s enforcement of the Corporate Transparency Act (CTA) that was issued by the District Court for the Eastern District of Texas on December 3, 2024. The stay reintroduced the January 1, 2025 deadline for filings under the CTA for reporting companies formed prior to January 1, 2024. Shortly after the ruling, the Financial Crimes Enforcement Network (FinCEN) issued guidance extending the filing deadline to January 13, 2025 for most reporting companies.

Two members of the panel found that the government was likely to succeed in defending the CTA’s constitutionality, holding that the reporting requirements fall within US Congress’s Commerce Clause power. The majority also found that enjoining the statute would cause irreparable harm to the government’s anti-money laundering efforts and that this harm outweighed the burden on businesses.

Fifth Circuit Judge Catharina Haynes, dissenting in part, agreed that a national injunction was not appropriate but would have denied the temporary stay (and kept the injunction against enforcement in place) as to the parties.

After the stay was issued, FinCEN issued guidance extending the deadlines for reporting companies in light of the preliminary injunction. As a result, the reporting deadlines have been extended as follows:

• Reporting companies before January 1, 2024 must file by January 13, 2025
• Reporting companies created/registered in the United States on or after September 4, 2024, and with a filing deadline between December 3, 2024 and December 23, 2024, must file by January 13, 2025
• Reporting companies created/registered in the United States between December 3, 2024 and December 23, 2024 will have an additional 21 days from their original deadline.
• Reporting companies created/registered on or after January 1, 2025 must file within 30 days of receiving notice that their creation/registration is effective
• Reporting companies qualifying for disaster relief may have deadlines extended beyond January 13, 2025, and should abide by whichever deadline falls later

Due to the high volume of filings expected to be completed in the coming days, reporting companies should prepare and file their Beneficial Ownership Information (BOI) reports as soon as possible and, in any event, in compliance with the revised deadlines. Our team will continue to monitor any developments pertaining to this case as they arise.