As of February 18, 2025, the US Department of the Treasury Financial Crimes Enforcement Network’s (FinCEN) Corporate Transparency Act (CTA) reporting requirements have been restored—at least temporarily. The new filing deadline is March 21, 2025.
Stay of Smith Injunction
As we previously noted, on January 7, 2025, a federal district court in Texas issued a nationwide preliminary injunction in Smith v. United States Dep’t of the Treasury, which prevented the enforcement of the CTA’s reporting requirements.[1] Two weeks later, the Supreme Court of the United States (SCOTUS) issued a ruling in the Texas Top Cop Shop case, which lifted a separately imposed nationwide CTA injunction. However, since the SCOTUS decision in Texas Top Cop Shop did not address the Smith injunction—then just two weeks old—the Smith injunction remained in effect.
On February 5, 2025, the US Department of the Treasury, on behalf of FinCEN, filed a motion to stay the Smith injunction while it appeals the validity of that injunction to the US Court of Appeals for the Fifth Circuit.[2] The Smith court issued an order that granted the motion to stay and lifted the injunction against the enforcement of the CTA.[3]
FinCEN’s Response
Following the Smith court’s order, FinCEN extended the CTA reporting deadlines for most companies until March 21, 2025; this includes all initial, updated, and/or corrected Beneficial Ownership Information Reports (BOIRs) that would have been due absent any injunction. A reporting company given a deadline later than the new March 21 deadline (for example, because it qualifies for certain disaster relief extensions) is still bound by that later deadline. As of today, reporting companies formed on or after January 1, 2025 must file their BOIRs within 30 days of formation.
Interestingly enough, FinCEN has indicated that it may modify certain other deadlines and reporting requirements to further alleviate the regulatory burden on US small businesses that are considered “lower-risk” with respect to national security. However, FinCEN has not yet specified which deadlines, reporting requirements, or entities will be subject to these changes.
Texas Top Cop Shop Injunction (Post-SCOTUS) and McCarter & English Outlook
It is important to note that the CTA remains subject to litigation in the US Court of Appeals for the Fifth Circuit, among other venues. Just two days after the Department of the Treasury filed its appeal in Smith, it also submitted an appellate brief to the Fifth Circuit, defending the constitutionality of the CTA and its reporting requirements.[4] Briefing in this case is set to be complete by February 28, 2025, with oral arguments to follow on March 25, 2025.[5] It is currently unclear whether the Fifth Circuit will consolidate the Smith and Texas Top Cop Shop cases, or if the Fifth Circuit’s decision in Texas Top Cop Shop will supplant the arguments in Smith, rendering the latter moot.
The status and validity of the CTA remain uncertain; however, it is clear that the Trump administration’s Department of Justice will continue to defend its constitutionality. We expect and will continue to monitor and provide further updates regarding the Texas Top Cop Shop appeal as well as the Smith appeal. In the meantime, reporting companies should remain vigilant and be prepared to meet the current March 21, 2025 reporting deadline.
Please contact a lawyer on our team with any questions you might have concerning reporting and compliance requirements as we continue to monitor these developments. Please note that we do not provide advice as to the application of the CTA to an entity unless we have been expressly engaged to provide such advice.
[1] Smith v. United States Dep’t of the Treasury, No. 6:24-CV-336-JDK, 2025 WL 41924, at *2, *14 (E.D. Tex. Jan. 7, 2025) (imposing a nationwide preliminary injunction and characterizing the CTA as a law “unprecedented in its breadth [that] expands federal power beyond constitutional limits”).
[2] Defendants’ Motion for Stay Pending Appeal, Smith v. U.S. Dep’t of the Treasury, No. 6:24-CV-00336-JDK, ECF No. 33 (E.D. Tex. Feb. 5, 2025); Notice of Appeal, Smith v. U.S. Dep’t of the Treasury, No. 6:24-CV-00336-JDK, ECF No. 32 (E.D. Tex. Feb. 5, 2025).
[3] Smith v. U.S. Dep’t of the Treasury, No. 6:24-CV-00336-JDK, ECF No. 39 (E.D. Tex. Feb. 18, 2025).
[4] Brief for Appellants, Texas Top Cop Shop, Inc. et al. v. Bondi et al., No. 24-40792, ECF No. 212 (5th Cir. Feb. 7, 2025).
[5] Briefing Notice (Expedited Schedule), Texas Top Cop Shop, Inc. et al. v. Bondi et al., No. 24-40792, ECF No. 163 (5th Cir. Dec. 27, 2024).