In a Corporate Transparency Act update, the Supreme Court has allowed enforcement, requiring businesses to disclose ownership information. However, FinCEN also released a statement clarifying voluntary filing.
Corporate Transparency Act Update: Implementation Moves Forward
The Corporate Transparency Act update now moves forward as the Supreme Court lifts a prior injunction against its enforcement. The law mandates businesses to disclose beneficial ownership information, a requirement paused due to ongoing constitutional challenges.
The Fifth Circuit Court is set to hear arguments about the law’s constitutionality on March 25. While one justice advocated immediate clarification of injunction rules, another expressed concerns about the government’s urgency claims.
FinCEN is expected to clarify guidance for businesses with pending or overdue filings under the Corporate Transparency Act.
In an online notice, FinCEN clarified:
“On January 23, 2025, the Supreme Court granted the government’s motion to stay a nationwide injunction issued by a federal judge in Texas (Texas Top Cop Shop, Inc. v. McHenry—formerly, Texas Top Cop Shop v. Garland). As a separate nationwide order issued by a different federal judge in Texas (Smith v. U.S. Department of the Treasury) still remains in place, reporting companies are not currently required to file beneficial ownership information with FinCEN despite the Supreme Court’s action in Texas Top Cop Shop. Reporting companies also are not subject to liability if they fail to file this information while the Smith order remains in force. However, reporting companies may continue to voluntarily submit beneficial ownership information reports.”
