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Corporate Transparency Act- Updated as of 12/27/2024

The Corporate Transparency Act (“CTA”), which became effective January 1, 2024, impacts almost all closely held corporations, limited liability companies (LLCs) including single-member LLC, limited partnerships, and other closely held entities, as well as the legal and beneficial owners of such entities such as trusts and estates.  This is the case even if such entities only hold real estate and conduct no active business.

On December 3, 2024, the U.S. District Court for the Eastern District of Texas provided the entire country with nationwide temporary injunctive relief from having to comply with the January 1, 2025 deadline to file certain Beneficial Ownership Information (BOI) Reports required by the Corporate Transparency Act (CTA).

On December 6, FinCEN, the branch of the U.S. Treasury Department and the agency responsible for enforcement of the CTA posted its response to this preliminary injunction.  Please read this handout for more information. MGD Law is monitoring developments and will provide further guidance to MGD clients.

On December 23, 2024, the 5th Circuit Court of Appeals granted the government relief and lifted the injunction, making the filing requirement mandatory.

On December 23, 2024, FinCEN released a statement extending the compliance deadline for the pre-2024 business entities to January 13,2025.

On December 24, 2024, the plaintiffs in the case filed for a rehearing en banc (full court), with a response requested by January 6, 2025.

On December 26, 2024, the merits panel of the 5th Circuit Court of Appeals VACATED the December 23, 2024 decision by the motions panel, effectively reinstating the nationwide injunction on FinCEN’s ability to enforce the BOI report filing deadline.

On December 27, 2024, FinCEN posted its response to the December 26 decision stating that reporting companies are not required to file BOI reports while the order remains in effect.

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