We have previously reported on the various court decisions that have, since the end of 2024, suspended, reinstated, and suspended again the reporting obligations of beneficial ownership interests (“BOI”) before the US Department of the Treasury’s Financial Crimes Enforcement Network (“FinCEN”) pursuant to the Corporate Transparency Act (the “CTA”), the federal law that came into effect on January 1, 2024.  Background information on the CTA and the courts’ decisions referred to above can be found in our previous letters to clients, available here,  here and here.

On February 18, 2025 the U.S. District Court for the Eastern District of Texas issued a decision in Smith, et al. v. U.S. Department of the Treasury, et al. (6:24-cv-00336, E.D.) which has reversed the nationwide injunction that had suspended application of the CTA and has once again reinstated the BOI reporting obligations under such Act.

As of the date of this letter, all non-exempt entities under the CTA are once again legally obligated to file BOI reports before FinCEN. Unless an entity was previously given a later reporting deadline, the majority of the entities subject to the CTA have to file initial, updated and/or corrected BOI reports by the new deadline of March 21, 2025. Failure to do so may cause the application of economic and other penalties by FinCEN. In the context of the recent court decision, FinCEN has announced that it will assess, before the date set forth above, updated deadlines to submit the BOI reports as it recognizes that “reporting companies may need additional time to comply”. Furthermore, FinCEN has expressed its intention to revise the reporting rule, to focus on reporting obligations from entities posing a greater national security risk, while reducing the reporting burden to lower-risk entities (including many small businesses nationwide). The full text of FinCEN’s notice can be found here.

Please bear in mind that the legal challenges against the constitutionality of the CTA will continue their legal course, and they may ultimately affect the CTA’s reporting requirements. We will continue to report any additional developments on this matter.

Please note that this letter is sent for informational purposes only and does not constitute legal advice.

If you have any questions regarding the CTA or this letter, please don’t hesitate in contacting our office at (281) 367-2222 or acasas@stibbsco.com.