A nationwide injunction issued by the U.S. District Court for the Eastern District of Texas has temporarily halted enforcement of the Corporate Transparency Act[1] and the Reporting Rule[2], delaying the year-end deadline for filing Beneficial Ownership Information (BOI) reports. The injunction, declared on December 3, 2024, pauses compliance requirements pending further developments.
What does this mean? In the Court’s words, “reporting companies need not comply with the CTA’s January 1, 2025, BOI reporting deadline pending further order of the Court.”
Although the Corporate Transparency Act’s reporting obligations are stalled, the injunction itself is under review following the defendant’s appeal to the Fifth Circuit Court of Appeals on December 5, 2024[3]. If the injunction is overturned, the new BOI reporting deadline will remain uncertain.
The Financial Crimes Enforcement Network (FinCEN) confirmed that while the preliminary injunction is in effect, reporting companies are not required to submit Beneficial Ownership Information (BOI) and will face no penalties for non-compliance. However, FinCEN will continue to accept voluntary BOI submissions during this time.
Many business owners likely welcomed the news of the injunction with relief; however, the outcome of this litigation remains uncertain. The Department of Justice is expected to pursue an expedited appeal, particularly as new leadership (appointed by a president who previously opposed the CTA) takes office on January 20, 2025. Businesses that still need to submit their BOI reports should monitor developments closely on FinCEN’s website.
FEAGANS LLC will monitor this litigation and any developments. If you have any questions regarding the BOI report temporary nationwide injunction, ongoing litigation, or the practical implications of this injunction, please contact FEAGANS LLC.
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[1] 31 U.S.C. § 5336
[2] (31 C.F.R. 1010.380)
[3] Texas Top Cop Shop, Inc. et al. v. Garland et al., No. 4:24-CV-478, Dkts. 32, 34.
