And just like that—the Corporate Transparency Act is back!

The Corporate Transparency Act (CTA), effective January 1, 2024, requires entities created or registered to do business in the United States to report their BOI to the Financial Crimes Enforcement Network (FinCEN) on an ongoing basis unless they are subject to an exemption (Reporting Companies).¹ The CTA’s constitutionality has been challenged in multiple cases, including in Texas Top Cop Shop, Inc. v. Bondi² and Smith v. Treasury,³ both of which were brought in the US District Court for the Eastern District of Texas.⁴

In December 2024, the Texas federal district court in Texas Top Cop Shop found that the CTA was likely unconstitutional and issued a nationwide preliminary injunction staying all reporting deadlines. However, the government appealed, and in January 2025, the Supreme Court of the United States granted the government’s motion to stay that nationwide injunction pending an appeal to the Fifth Circuit. 

Following the Supreme Court’s decision, FinCEN took the position that Reporting Companies were still not required to file BOI reports because another Texas federal district court in Smith v. Treasury had separately stayed the CTA’s reporting deadlines pursuant to the Administrative Procedure Act. FinCEN subsequently appealed the stay to the Fifth Circuit and simultaneously filed a motion with the district court to lift the stay based on the Supreme Court’s decision in Texas Top Cop Shop.  

Earlier this week, the Smith court granted the government’s motion and lifted the stay on FinCEN’s enforcement of the CTA pending disposition of the appeal to the Fifth Circuit. As previewed in its motion to lift the stay, FinCEN is granting a 30-day reprieve for companies to comply with their BOI reporting obligations.⁵ Reporting Companies currently have until March 21, 2025, to file their BOI reports.

* * * TAKEAWAYS * * *

This isn’t the last word on the CTA. There are several ways that the CTA’s reporting deadlines could be extended yet again. 

• First, FinCEN has indicated that it will consider further extensions of the reporting deadlines, including before the current March 21, 2025 deadline.
• Second, additional judicial action is imminent. The Fifth Circuit has scheduled oral argument on FinCEN’s motion to stay the preliminary injunction in Texas Top Cop Shop for April 1, 2025, and the Fifth Circuit could decide to reinstate the preliminary injunction. The lift of the stay in Smith is also pending disposition of the appeal, and many other cases challenging the CTA’s constitutionality are ongoing.
• Finally, Congress could intervene and pass legislation to extend the reporting deadlines. On February 10, 2025, the US House of Representatives passed the “Protect Small Business from Excessive Paperwork Act of 2025,” which seeks to extend the effective date of the CTA from January 1, 2024, to January 1, 2026.⁶ If the US Senate passes the bill and it becomes law, then the reporting deadlines could be extended. 

Congress and FinCEN could go even further and change the CTA’s substantive reporting requirements.

• FinCEN’s announcement of the March 21 reporting deadline indicates that FinCEN “intends to initiate a process this year to revise the BOI reporting rule to reduce burden for lower-risk entities, including many US small businesses.”
• Congress also could act to change—or even repeal—the CTA’s reporting requirements. On January 15, 2025, the Senate introduced the “Repealing Big Brother Overreach Act,” which would repeal the CTA in its entirety.⁷ Notably, similar bills were introduced in the House of Representatives and Senate in 2024, but neither gained traction.⁸ 

While additional changes may be on the horizon, in the meantime companies should prepare to comply with the CTA’s reporting requirements by March 21, 2025. 

• If they have not already done so, entities created or registered to do business in the United States should promptly determine whether they must file BOI reports pursuant to the CTA and, if so, what information must be reported.
• Many entities had already filed their initial BOI reports before the nationwide preliminary injunction in December 2024, and others voluntarily filed during the intervening period. Reporting Companies that previously filed should consider whether there have been any changes to their BOI and/or whether they need to correct any previously disclosed information and, if necessary, file an updated or corrected report by March 21, 2025.
• Reporting Companies should implement controls to ensure that they are equipped to identify changes in their beneficial ownership and file updated BOI reports with FinCEN within 30 days going forward.

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If you have any questions about this Legal Briefing, please feel free to contact any of the attorneys listed or the Eversheds Sutherland attorney with whom you regularly work.

_{1 Corporate Transparency Act, 31 U.S.C. 5336, and its implementing regulations.
2 Texas Top Cop Shop, Inc. v. Bondi, 4:24-cv-478 (E.D. Tex.).
3 Smith v. Dep’t of Treasury, 6:24-cv-0036 (E.D. Tex.).
4 Please see our other alerts for additional information about the CTA’s BOI reporting requirements.
5 FinCEN Beneficial Ownership Information landing page (last accessed Feb. 19, 2025). 
6 H.R. 736 – Protect Small Business from Excessive Paperwork Act of 2025, 119th Congress (2025-2026).
7 S. 100 – Repealing Big Brother Overreach Act, 119th Congress (2025-2026).
8 H.R. 8147 – Repealing Big Brother Overreach Act, 118th Congress (2023-2024); S. 4297 – Repealing Big Brother Overreach Act, 118th Congress (2023-2024).}