By Caleb S. Dunn, Esq.
It’s been a head-spinning couple of days when it comes to enforcement of the Corporate Transparency Act (“CTA”).
Business owners can, at least for now, continue to disregard the CTA’s reporting requirements following the most recent decision by the United States Court of Appeals for the Fifth Circuit.
In a surprising decision, on December 26, a Fifth Circuit panel reversed the court’s prior December 23 decision and reinstated the injunction blocking enforcement of the CTA.
Previously, on December 23, a three-judge panel for the Fifth Circuit issued a stay of a nationwide preliminary injunction issued by a federal district court in Texas earlier this month. At that time, the court reinstated the January 1, 2025 deadline for CTA filings. The federal government then voluntarily extended the deadline to January 13, 2025.
The Corporate Transparency Act requires certain corporations, limited-liability companies and other business entities in the United States to submit information — including their legal and trade names, their principal places of business and the identity of “beneficial owners” — to the Financial Crimes Enforcement Network (“FinCEN”), the criminal enforcement arm of the U.S. Department of the Treasury. The CTA primarily applies to small businesses.
Following the latest ruling by Fifth Circuit, companies in Pennsylvania and elsewhere that are subject to the CTA may elect to postpone filing their reports. Or business owners can go ahead and submit their required business information to FinCEN now in light of the brief timeframe that they may have to comply with the law in the event that the injunction is lifted again.
Business owners should monitor the changing regulatory landscape by subscribing to our legal updates, and reach out with any questions.
For more information about how the CTA and this ruling may impact your business, call us at 412-209-3200 or email wlabovitz@palawfirm.com or cdunn@palawfirm.com to schedule a free, no-obligation consultation.