As our clients know, FOS has been actively monitoring cases challenging the Corporate Transparency Act (CTA) and updating clients on resulting CTA reporting obligations.
This includes last month’s Fifth Circuit Court of Appeals decision to enjoin FinCEN from enforcing the CTA while the case is under expedited appellate review to “preserve the constitutional status quo.” https://foslaw.com/cta-whiplash-continues-this-time-in-a-good-way/.
Almost a month ago, the U.S. Attorney General asked the U.S. Supreme Court to stay the Fifth Circuit’s injunction in Texas Top Cop Shop v. McHenry against the filing requirements pending the resolution of the appeal. Yesterday afternoon, the Supreme Court granted that application. That might have signaled that companies had to resurrect their prior reporting efforts and prepare to make imminent filings.
However, today, the Financial Crimes Enforcement Network (FinCEN) stated that, for now, despite the Supreme Court’s ruling, reporting companies are still not required to file beneficial ownership information with FinCEN. https://www.fincen.gov/boi
FinCEN’s reasoned that, aside from the Fifth Circuit case, a separate Texas district court has issued a stay of the CTA reporting requirements that remains in effect (Smith v. U.S. Department of the Treasury). FinCEN will, however, accept voluntary filings of CTA reports.
FOS acknowledges the continued confusion created by these and other legal challenges to the CTA and its rules. FOS will continue to actively monitor future developments and challenges to the CTA to keep clients updated and informed.
In the meantime, if you have any questions about the impact of the CTA, or the legal challenges to it, on your business, contact your FOS attorney.
Image: Bloomberg Creative
