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United States – Developments in Corporate Transparency Act Litigation
On January 23rd, 2025, the United States Supreme Court (SCOTUS) granted the government’s motion to stay a nationwide injunction issued in the case of Texas Top Cop Shop, Inc., et al. v. Garland, et al.
This decision relates to Beneficial Ownership Information (BOI) reporting obligations for companies under the Corporate Transparency Act.
Key Points:
1. Dual Injunctions Involved
While SCOTUS lifted one injunction, another remains active (Smith v. U.S. Department of the Treasury). Therefore, this decision does not immediately reinstate BOI filing obligation for companies.
2. Current Reporting Status
Companies are not currently required to file beneficial ownership information with FinCEN.
3. FinCEN’s Response:
On January 24, FinCEN issued an update stating that voluntary submissions will still be accepted, and no penalties will be issued for companies failing to submit BOI reports.
4. Enforcement Suspension
During the injunction period, FinCEN cannot enforce penalties for non-compliance with reporting requirements.
The ultimate resolution of these cases and the future of the Corporate Transparency Act (CTA) remains unclear. Given the ongoing uncertainty, it is advisable companies:
- Continue compliance preparations
- Consider filing reports on a voluntary basis
Mercator® by Citco (Mercator) will continue to monitor the situation and provide updates as the CTA litigation cases progress.
Read our FAQs for detailed information on CTA and U.S. Beneficial Ownership reporting obligations.
Contact us for specific guidance on your company’s BOI reporting obligations and further assistance.
