On February 18, 2025, the U.S. District Court for the Eastern District of Texas lifted the only remaining injunction against the Federal government enforcing the Corporate Transparency Act. (See MLLP’s prior Client Alerts on this topic at www.martinllp.net.) This ruling put the beneficial ownership information (BOI) reporting requirements of the CTA back into effect and caused the Financial Crimes Enforcement Network (FinCEN) to promptly announce that BOI filings for most U.S. business entities would be due by March 21.
In yet another about face, on March 2, 2025, the Treasury Department (of which FinCEN is a part) announced that it will not enforce any penalties or fines associated with BOI reporting requirements and will be proposing new rules to narrow the scope of the CTA to foreign companies only. This announcement appears to put an end to the current reporting regime under the CTA.
Treasury’s narrowing of the CTA is in conflict with the language of that statute, so there is some risk that it could be overturned if challenged in court (assuming the CTA is not amended by Congress to come in line with Treasury’s views). However, it is unclear what party might bring such a challenge. Absent a successful challenge, domestic business entities (corporations, partnerships, LLCs, and the like) can rely on Treasury’s officially announced position and forego filing BOI reports without concern about an enforcement action by the Treasury Department, including FinCEN.
