Corporate Transparency Act Timeline Update
Major Update
The Treasury Department announced that there will be no enforcement of penalties or fines associated with the beneficial ownership information reporting rule under the existing regulatory deadlines of the Corporate Transparency Act (“CTA”).
Further, they have stated that there will be no enforcement of any penalties or fines against U.S. citizens, domestic reporting companies, or their beneficial owners after the forthcoming reporting rule changes take effect. The Treasury Department will narrow the scope of the rule to foreign reporting companies only.
For more information on this major update and other relevant legislation click here.
Updated Timeline of Corporate Transparency Act Developments
- 2024, January 01 – Corporate Transparency Act reporting requirements commence and initially become effective.
- 2024, December 03 – Texas Federal Court Issues Injunction Halting the CTA’s Beneficial Ownership Obligations.
- 2024, December 05 – The government files a notice of appeal with the Fifth Circuit Court of Appeals.
- 2024, December 23 – The Fifth Circuit Court of Appeals overturns the injunction and stays the Corporate Transparency Act. The government postpones the reporting deadline until January 13, 2025.
- 2024, December 26 – The Fifth Circuit Court of Appeals reinstates the nationwide injunction.
- 2024, December 31 – Supreme Court Justice Samuel Alito asks Respondent-Plaintiffs to file their motion to the Justice Department by January 10. 2025. The Respondent-Plaintiffs have met the filing deadline.
- 2025, January 07 – Smith v. U.S. Department of the Treasury, court issues nationwide injunction.
- 2025, February 05 – The Department of the Treasury asked Judge Kernodle to stay the order in Smith and filed a notice of appeal to the Fifthy Circuit.
- 2025, February 07 – The Department of Justice filed appellate briefs defending the constitutionality of the CTA in separate cases pending in the Fourth and Fifth Circuits.
- 2025, February 18 – Judge Kernodle issued a stay of his January decision in Smith.
- 2025, February 19 – FinCEN issued guidance regarding the applicable deadlines. FinCEN extended the reporting deadline for reporting companies to March 21, 2025, except for reporting entities previously granted extensions (ex. those impacted by natural disasters). Additionally, FinCEN “will assess its options to further modify deadlines, while prioritizing reporting for those entities that pose the most significant national security risks.” FinCEN has stated it intends to revise the Reporting Rule to reduce the burden for lower-risk entities, specifically small businesses.
- 2025, March 02 – Financial Crimes Enforcement Network (FinCEN) announced that, consistent with the Department of the Treasury’s March 2, 2025, announcement, it is issuing an interim final rule that removes the requirement for U.S. companies and U.S. persons to report beneficial ownership information (BOI) to FinCEN under the Corporate Transparency Act. Foreign entities that meet the new definition of a “reporting company” and do not qualify for an exemption from the reporting requirements must report their BOI to FinCEN under new deadlines. These foreign entities will not be required to report any U.S. persons as beneficial owners, and U.S. persons will not be required to report BOI with respect to any such entity for which they are a beneficial owner.
- 2025, March 21 – Deadline to file Beneficial Ownership Information with FinCEN for most entities.
- 2026, August 13 – FinCEN Permanently Ends Beneficial Ownership Reporting Requirements for Millions of Small Business Owners
Current Steps
Under the final rule, foreign entities that are reporting companies will still be required to report beneficial ownership information for foreign individuals.
Kemp Klein will continue to monitor developments affecting foreign reporting companies under the CTA. Separate state reporting requirements may also apply. New York, for example, has enacted its own beneficial ownership disclosure requirements for certain LLCs formed outside the United States and authorized to do business in New York, while other states have considered similar legislation. An entity’s formation or registration to do business in a particular state may therefore create additional reporting obligations.
Resources
Disclaimer
This page does not constitute legal advice or providing legal services. This page is merely a general announcement of a new regulation. Nothing contained within this page constitutes a lawyer client relationship between Kemp Klein Law Firm and the reader. The implementation of the Corporate Transparency Act is still in development. Further, a variety of other federal and state laws and regulations may apply to your particular business activities. You may contact your legal counsel if you have specific questions.
Make sure to check out the Legislative Updates section of kkue.com for Important Information and insight on major new legal developments.
Please contact your Kemp Klein Law Firm Attorney or email us at CTAGuidance@kkue.com if you have any additional questions regarding your company’s reporting obligations or to discuss the process of compliance. Standard Billing Rates will apply.
Our Corporate Transparency Act Compliance Experts
William E. Haines II
Richard C. Bruder
