Corporate Transparency Act Deadlines to be Extended by New Regulation
February 28, 2025
Treasury’s Financial Crimes Enforcement Network (“FinCEN”) announced1 on February 27, 2025 its intention to issue an Interim Final Rule by March 21 that will extend the current March 21, 2025 deadline for compliance with the Corporate Transparency Act (“CTA”). FinCEN also announced that it will not enforce fines or penalties against companies until after the new deadlines in the forthcoming regulation have passed.
A February 18, 2025 decision by a court in the Eastern District of Texas had reinstated the CTA’s beneficial ownership information reporting requirements.2 The next day, FinCEN extended compliance deadlines to March 21, 2025 but also announced its intention to revise the reporting regulation and consider additional compliance extensions.3 The most recent Texas decision came after the Supreme Court granted the Government’s application for a stay of the nationwide preliminary injunction issued by another court in the Eastern District of Texas in James R. McHenry, III, Acting Attorney General, et al., v. Texas Top Cop Shop, Incorporated, et al.4 There are now two nationwide injunctions stayed pending appeal. The Texas Top Cop Shop injunction remains on appeal in the Fifth Circuit,5 with oral argument scheduled for April 1, 2025.
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O’Melveny & Myers will continue to provide updates as circumstances evolve. We can help with any questions you may have about the CTA. Feel free to contact our team of experts.
1 https://www.fincen.gov/news/news-releases/fincen-not-issuing-fines-or-penalties-connection-beneficial-ownership (February 27, 2025).
2 Smith et. al. v. United States Department of The Treasury, et. al., E.D. Tex. Case No. 6:24-cv-00336.
3 FinCEN Notice, FIN-2025-CTA1, FinCEN Extends Beneficial Ownership Information Reporting Deadline by 30 Days; Announces Intention to Revise Reporting Rule (February 18, 2025).
4 James R. McHenry, III, Acting Attorney General, et al., Applicants v. Texas Top Cop Shop, Incorporated, et al., Docket No. 24A653 (604 U.S., Jan. 23, 2025).
5 Texas Top Cop Shop, Inc. v. Garland, et. al., No. 24-40792, 2024 WL 5203138 (5th Cir. Dec. 23, 2024); Texas Top Cop Shop, Inc., et al. v. Bondi, et. al., E.D. Tex., Case No. 4:24-cv-00478-ALM; 24-40792.
This memorandum is a summary for general information and discussion only and may be considered an advertisement for certain purposes. It is not a full analysis of the matters presented, may not be relied upon as legal advice, and does not purport to represent the views of our clients or the Firm. Tracie Ingrasin, an O'Melveny partner licensed to practice law in New York; AnnaLou Tirol, an O'Melveny partner licensed to practice law in California and the District of Columbia; Wenting Yu, an O'Melveny partner licensed to practice law in California and New York; Martin Mayo, an O'Melveny counsel licensed to practice law in California; and Connor Corbitt, an O'Melveny associate licensed to practice law in Texas, contributed to the content of this newsletter. The views expressed in this newsletter are the views of the authors except as otherwise noted.
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