What the Recent Injunction Against the Corporate Transparency Act (CTA) Means for Your Business

Dec 05, 2024

On Tuesday, a federal court in Texas issued a nationwide injunction prohibiting the enforcement of the Corporate Transparency Act (CTA). The CTA, which was set to require an estimated 32.5 million companies in the U.S. to report sensitive information about their beneficial owners (BOI) to FinCEN by January 1, 2025, is now on hold due to constitutional concerns.

What Does This Mean for You?

The court’s decision means that companies are no longer obligated to meet the January 1, 2025, BOI reporting deadline or comply with related CTA requirements. While this provides immediate relief, the ruling is not necessarily final. The federal government is expected to appeal, and higher courts, including the Supreme Court, may weigh in.

For now, the CTA’s enforcement is paused. However, the broader legal battle is likely to continue, and the final outcome remains uncertain.

Our Recommendation

We advise clients to remain proactive:

  • Continue Gathering Information: If your business falls under the CTA’s reporting requirements, we recommend you gather the necessary BOI information. Preparing now will help ensure compliance should the injunction be lifted or the requirements reinstated. Check out our BOI Insights & Resource Hub for details.
  • Stay Informed: Legal and regulatory landscapes can shift quickly. We will continue to monitor developments closely and provide updates as the situation evolves.
  • Be Ready to File: While enforcement is currently halted, the best course of action is to be prepared to submit your BOI report promptly if needed.

The implications of the Corporate Transparency Act injunction go beyond compliance and touch on broader concerns about federal authority and privacy. Rest assured, we are here to guide you through these changes and keep you informed. If you have questions or need assistance navigating these requirements, please get in touch with a member of our BOI reporting team at wvco.com/contact-us.

Categories: Tax Compliance