Federal District Court Enjoins Enforcement of Corporate Transparency Act & BOI Reporting

Business & Corporate LawFirm Announcements
Written By Christie Browning

On December 3, 2024, the Federal District Court for the Eastern District of Texas granted a nationwide preliminary injunction that enjoins the federal government from enforcing the Corporate Transparency Act (CTA) through its decision in Texas Top Cop Shop, Inc., et al. v. Garland, et al., Docket No. 4:24-cv-00478 (E.D. Tex. May 28, 2024).

The CTA was enacted in 2021 with the intention of enhancing transparency in entity structures and ownership to combat money laundering, tax fraud, and other illicit activities. In attaining this goal, the CTA gave the Financial Crime Enforcement Network (or “FinCEN”) the power to promulgate and enforce Beneficial Ownership Information (BOI) reporting. BOI reporting required that each business entity in the United States provide certain information related to the entity’s ownership and management, among other things. The CTA and BOI reporting have been widely criticized as an overreach by the federal government with many questioning which Constitutional power Congress is utilizing to exercise the authority provided in the CTA.

Nevertheless, pursuant to the CTA, BOI reporting opened on January 1, 2024 with all business entities formed in the United States before this date being required to file a BOI report by December 31, 2024. In addition, all business entities formed on or after January 1, 2024 were likewise subjected to BOI reporting requirements.

With the decision from the Eastern District of Texas in Texas Top Cop Shop, all BOI reporting requirements have now been put on hold until either the decision is overturned or a more definitive action is taken by the federal courts or federal government as to the viability of the CTA.

As a result of this decision, BBDS&B is recommending that all clients wait and see what will become of the CTA. This includes waiting to file BOI reports as the December 31 deadline for filing is no longer in effect. However, if you prefer to file your BOI report, please do so or, if you wish, you may engage our firm to file it on your behalf

If you have any questions on the court decision from the Eastern District of Texas enjoining the CTA and its impact on BOI filing, please contact us.

Christie Browning

Christie is a five-time HSPA award-winning writer with a long resume of creative, compelling writing. Her background includes journalism and marketing, which allows her to bring a specialized voice to the pieces created for her clients. On her own, Christie has written for newspapers, online magazines and major publications. For her clients, Christie produces web designs, press and media releases, blog articles, downloadable worksheets and flyers as well as social media content. Her long-time career as an entrepreneur gives her unique insight into what her clients need to promote their products, services and messages.

https://www.contentbyrequest.com
Next

Firm completes first annual food drive