Update on Beneficial Ownership Information Reporting

Yana Timokhova / January 16, 2025

The Corporate Transparency Act (CTA) requires most businesses, including Canadian entities registered in the U.S., to file a Beneficial Ownership Information Report (BOIR) with the Financial Crimes Enforcement Network (FinCEN). However, due to a recent federal court decision, this filing requirement has been temporarily suspended.

1. Court Decision and Current Status

On December 3, 2024, the U.S. District Court for the Eastern District of Texas issued a preliminary injunction that halted the enforcement of the BOIR filing requirement. Consequently, businesses are not currently required to submit beneficial ownership information to FinCEN. However, businesses may choose to voluntarily file their reports.

The decision is subject to appeal. On December 23, 2024, the Fifth Circuit Court of Appeals issued a temporary stay of the injunction, thereby extending the compliance deadline. However, on December 26, 2024, that stay was vacated, and the injunction remains in effect. As a result, businesses are not required to file their BOIRs while the legal proceedings continue.

2. Implications for Your Business

No Immediate Filing Requirement: Companies are temporarily exempt from submitting their BOIRs due to the injunction, though voluntary submissions remain possible.

Legal Uncertainty: The case is ongoing, and future court decisions may affect the filing requirements in the coming months.

Extended Deadlines: The U.S. Department of the Treasury has extended compliance deadlines, providing businesses with additional time once the injunction is lifted.

At Altro LLP, we are closely monitoring these developments. We are available to guide you through the filing process once the reporting requirements are reinstated.

Yana Timokhova

Yana Timokhova

LLM, Student-At-Law (Altro LLP)

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