U.S. Supreme Court Lifts Injunction on Corporate Transparency Act Enforcement; Organizations Obligated to Make BOI Reports

The Supreme Court of the United States has stayed the nationwide injunction against enforcement of the Corporate Transparency Act (CTA), allowing the government to resume implementation of the law while litigation continues. Therefore, organizations are again required to make beneficial ownership interest reports to the U.S. Treasury Department’s Financial Crimes Enforcement Network (FinCEN).

The CTA requires businesses to disclose beneficial ownership information to FinCEN to enhance financial transparency and combat illicit activities such as money laundering and terrorism financing. The law has faced legal challenges, including a district court ruling in Texas that enjoined its enforcement nationwide.

After the Fifth Circuit Court of Appeals reinstated the injunction on December 26, 2024, the federal government filed an emergency application with the Supreme Court, arguing that the CTA is a critical tool for national security and financial crime prevention. On January 23, 2025, the Supreme Court granted the government’s request, effectively lifting the injunction and allowing enforcement to proceed while the merits of the case are still under review in the Fifth Circuit.

The statute required organizations formed prior to January 1, 2024 to file BOI reports by January 1, 2025. While FinCEN did extend the compliance deadline using agency discretion in response to prior legal rulings that called into question the reporting deadlines to January 13, 2025, it is not clear that there will be a similar action at this time. The prior extension was issued and communicated by the Biden Administration. It is unclear how the Trump Administration will direct FinCEN in this regard. Complicating matters further, the Trump Administration issued an executive order on January 20, 2025, prohibiting federal agencies from issuing guidance documents or taking substantive action by the agency until specifically directed by the Trump Administration. In light of this, we cannot assume that FinCEN will issue new guidance or extend compliance deadlines in light of the recent U.S. Supreme Court CTA decision anytime soon. Entities subject to the CTA should consider making any unfiled BOI reports now rather than waiting for FinCEN to provide further directions.

Although the Supreme Court’s decision means that FinCEN may and must enforce CTA now, the underlying legal challenge remains pending in the Fifth Circuit, which is reviewing the case on the merits. The appellate court’s ultimate ruling could have significant implications for the CTA’s long-term enforceability.

If you have any questions relating to the CTA or need assistance in determining how to prepare for this filing requirement, please do not hesitate to contact your counsel at Weintraub Tobin or any member of Weintraub Tobin’s CTA compliance team identified here.