Federal Court Halts Beneficial Ownership Reporting Requirements: What Comes Next for Business Owners?

On December 3, 2024, the National Federation of Independent Businesses (NFIB) filed a lawsuit challenging the constitutionality of the Corporate Transparency Act (CTA). This act previously required small business owners to disclose the personal information of any beneficial owner to the Financial Crimes Enforcement Network (FinCEN).

As a result of this lawsuit, a nationwide preliminary injunction has temporarily halted the enforcement of the CTA’s BOI reporting requirements.

Here is an outline of the changes this lawsuit created and how you can prepare your business for what may happen next.

What Changed?

Reporting Requirements Suspended

As of January 1, 2025, the requirement to submit any beneficial ownership information to the Financial Crimes Enforcement Network (FinCEN) will be no longer be enforced.

What Comes Next?

Potential for Appeal

While these changes go into effect in January 2025, the government could challenge this preliminary injunction. If their appeal succeeds, reporting requirements could snap back into place quickly.

What to Do

Check for Updates

Keep your finger on the pulse of this evolving situation. Monitor legal proceedings, potential rulings, and any new guidance from FinCEN.

Prepare for Potential Resumption

Get your ducks in a row. Start gathering beneficial ownership information (BOI) and familiarize yourself with the reporting process. This way, you’ll be ready to move quickly if the BOI requirements are reinstated.

Things Could Change

This is a fluid situation that could change at any moment. We will be actively monitoring it and bringing you any updates as they develop.

Questions?

Have questions about how to navigate this preliminary injunction for your business? Our team of business advisors is here to help. Contact Us.