By Eric J. Sachtjen, Shareholder
The Corporate Transparency Act (CTA) is back in the spotlight. On February 18, 2025, the U.S. District Court for the Eastern District of Texas in Smith v. U.S. Department of the Treasury, et al. (6:24-cv-00336) stayed its prior injunction, reinstating the CTA’s beneficial ownership information (BOI) reporting requirements nationwide. This shift follows months of uncertainty, and businesses must once again prepare to comply.
In response, the Financial Crimes Enforcement Network (FinCEN) announced on February 19, 2025, a 30-day extension for most reporting companies originally due to file by December 31, 2024. The new deadline is March 21, 2025. Companies with prior disaster-related extensions may retain their later deadlines if applicable, though plaintiffs in National Small Business United v. Yellen (N.D. Ala.) remain exempt from CTA reporting.
FinCEN plans to use this 30-day period to evaluate potential deadline adjustments, focusing first on entities posing significant national security risks. They’ve also signaled intent to revise BOI rules later this year to lessen the burden on lower-risk businesses, such as small U.S. companies. However, it’s unclear if relief will arrive before the March 21 deadline for entities existing as of January 1, 2024—or if changes will only apply to future requirements.
Adding another layer, Congress is stepping in. On February 10, 2025, the House unanimously passed a bill to push the CTA deadline for these entities to January 1, 2026, with a companion Senate bill introduced last week. Legislative action could reshape the CTA’s timeline, but for now, compliance remains the priority.
What Should You Do?
The CTA’s rollercoaster enforcement leaves businesses with a choice: file now to avoid potential penalties or wait for further developments—provided you’re ready to act if needed. If you opt to wait, compile your BOI data now so you’re prepared for the March 21 deadline if it holds. For those considering new entity formation, it may be worth pausing until FinCEN provides more clarity, especially if the 30-day reporting window feels restrictive.
While this informational publication is about legal issues, it is not legal advice. Legal information is not the same as legal advice and is not a sufficient substitute for or replace the advice or representation of a licensed attorney. If you desire an interpretation of any of the legal principles addressed herein, we recommend you consult with a licensed attorney.
Paine Hamblen, P.S. is a full-service law firm, based in Spokane, Washington, and can assist you with choosing the right business structure, complying with applicable laws and regulations, drafting and reviewing contracts, mitigating risks and liabilities, and navigating the complexities of employment and labor laws. For assistance with a particular business challenge you may be facing, call us at 509-455-6000.
Eric J. Sachtjen is a Shareholder at Paine Hamblen, PS whose practice includes in tax compliance, estate planning, and business advisory services.
