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On February 18, 2025, in the matter of Smith v. U.S. Department of Treasury, the U.S. District Court for the Eastern District of Texas issued a stay of its prior preliminary injunction barring the enforcement of the Corporate Transparency Act (the “CTA”). The court’s action cleared the way for the Financial Crimes Enforcement Network (“FinCEN”) to reinstitute a deadline for reporting companies to disclose beneficial ownership information (“BOI”). On February 19, 2025, FinCEN did just that, requiring most reporting companies to file BOI disclosures by March 21, 2025.
Even while setting a new deadline, FinCEN stated that during the intervening time, it “will assess its options to further modify deadlines, while prioritizing reporting for those entities that pose the most significant national security risks. FinCEN also intends to initiate a process this year to revise the BOI reporting rule to reduce burden for lower-risk entities, including many U.S. small businesses.” FinCEN has promised to “provide an update prior to [March 21, 2025] of any further modification of this deadline, recognizing that reporting companies may need additional time to comply with their BOI reporting obligations once this update is provided.” The deadline hardly seems fixed in stone.
In addition to FinCEN’s further assessments, cases challenging the CTA remain on appeal. Moreover, there are legislative efforts both to extend the deadline for BOI disclosures to January 1, 2026, and to repeal the CTA entirely.
For the time being, reporting companies need to be prepared to report BOI information by March 21, 2025 if they have not already done so. The legal landscape, however, is far from firm and new developments appear to be forthcoming.
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1 The information contained herein is intended as a general overview and should not be construed as legal advice. Readers should not act upon it without professional counsel and should seek advice applicable to their specific situation.
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