Texas Federal Court Issues Nationwide Injunction Halting Enforcement of Corporate Transparency Act. On 12/3/24, the U.S. District Court for the Eastern District of Texas found that the Corporate Transparency Act (CTA) and its implementing regulations are likely unconstitutional and issued a nationwide preliminary injunction temporarily halting enforcement of the CTA’s beneficial ownership information (BOI) reporting requirements. Characterized by the court as a “law enforcement tool – not an instrument calibrated to protect commerce,” the CTA required over 30 million existing business entities to report BOI to the Treasury Department’s Financial Crimes Enforcement Network (FinCEN) before 2025. According to the court, the Commerce Clause regulates existing activity but cannot compel activity; thus, the Commerce Clause cannot be used to compel information disclosure for law enforcement purposes. Further developments may reverse this decision.
After passage of the Corporate Transparency Act in 2021, all U.S. business entities must comply by filing the Beneficial Ownership Interest information with the Financial Crimes Enforcement Network (FinCen), which is overseen by the U.S. Treasury. For companies created prior to 2024, the due date is January 1, 2025; For new companies in 2024, the filing is due within 90 days of formation, and for new companies in 2025, the filing is due within 30 days of formation.
Owners of entities may e-file directly on the FinCen website HERE.
Learn how to e-file the report in a FinCen video HERE.
For FinCen Frequently Asked Questions, view HERE.