December 26, 2024

Corporate Transparency Act Landscape Changes - Again

In a recent FWW Client Alert, we reported that enforcement of the federal Corporate Transparency Act ("CTA") was enjoined by a federal court in Texas on December 3, 2024. The CTA requires filing of reports containing significant personal details regarding business owners with the Financial Crimes Enforcement Network ("FinCEN") under the U.S. Department of the Treasury. The injunction in the Texas litigation was welcome news to many businesses throughout the country (as well as to many of us at FWW). As warned in our previous alert, however, the hammer could drop again. And it did.

 

On December 23, 2024, the U.S. Fifth Circuit Court of Appeals issued an order that stayed the nationwide preliminary injunction on CTA enforcement. In that ruling, the Fifth Circuit found the government met its burden to show that the nationwide injunction was not appropriate.

 

The effect of this ruling is that the CTA may once again be enforced by FinCEN and that all of the CTA deadlines are back in effect. In a cynical indication of no federal largess, in the appeal the government had even requested a ruling no later than December 27, 2024, thereby potentially giving millions of law-abiding business owners a mere four more days to complete their initial compliance with CTA. Though the Fifth Circuit declined to provide any extraordinary relief on the timing, FinCEN itself has at least modified the compliance deadlines slightly as follows:

 

  • Reporting companies that were created or registered prior to January 1, 2024, have until January 13, 2025, to file their initial beneficial ownership information reports with FinCEN. (These companies would otherwise have been required to report by January 1, 2025.)
  • Reporting companies created or registered on or after September 4, 2024, that had a filing deadline between December 3, 2024, and December 23, 2024, have until January 13, 2025, to file their initial beneficial ownership information reports with FinCEN.
  • Reporting companies created or registered in the United States on or after December 3, 2024, and on or before December 23, 2024, have an additional twenty-one days from their original filing deadline to file their initial beneficial ownership information reports with FinCEN.
  • Reporting companies that are created or registered on or after January 1, 2025, have thirty days to file their initial beneficial ownership information reports with FinCEN.
  • Updated reports are required for changes in beneficial ownership previously reported to FinCEN.

 

Absent intervening action in further litigation or by FinCEN, reporting companies should act to file their beneficial ownership information reports as soon as possible. We will provide more information if mor significant FinCEN compliance changes occur. In the meantime, we remain available to answer questions and assist with filings under CTA upon request.

Farleigh Wada Witt Business Attorneys

Dean Sandow assists business owners, executives, professionals, families, family enterprises, and individuals plan for all stages of business and life, with an emphasis on creative use of entities, trusts, and planning techniques to maximize efficiency and tax savings and minimize administration. With a keen understanding of entity structure and management, Dean creates plans to enhance and manage assets for the client and for next generation or beyond. Dean was selected by his peers for inclusion in the Best Lawyers in America® 2018-2025 for Trusts and Estates and 2019-2025 for Corporate Law.

 

Contact Dean at 503.228.6044 or dsandow@fwwlaw.com

Steve Bennett handles entity formation, business succession, governance, and dispositions for businesses. He has substantial experience negotiating and drafting complex contracts in a variety of business settings. Steve emphasizes keeping the deal on track and moving forward. He represents both buyers and sellers in sales, mergers, acquisitions, and stock transfers.  Steve also has a diverse estate planning and real estate practice.

 

Contact Steve at 503.228.6044 or sbennett@fwwlaw.com

Brian Jolly's law practice focuses on corporate and general business matters, as well as estate and succession planning. With more than a decade of experience representing families, closely-held businesses, and non profit organizations, Brian brings considerable working knowledge in the areas of business formation, mergers and acquisitions, and internal and external disputes in a multitude of business and estate planning matters.

 

Contact Brian at 503.228.6044 or bjolly@fwwlaw.com


Paul Migchelbrink  maintains a diverse business practice advising clients in a number of industries on corporate and general business matters, real estate, intellectual property, commercial finance, and lending. He utilizes his broad and extensive experience to help his clients make sound strategic decisions and grow their businesses.  Paul advises clients on matters throughout the business life cycle, including the formation and financing of new business ventures, ownership and ownership transitions, mergers and acquisitions, equity and debt financing, business contracts, and the protection of trademarks and other intellectual property rights. Paul was selected by his peers for inclusion in the Best Lawyers in America® 2020-2025 for Corporate Law.


Contact Paul at 503.228.6044 or pmigchelbrink@fwwlaw.com

Marisol McAllister's practice focuses on real estate, financial services, and business law. In her financial services practice she represents financial service providers on complex commercial lending and leasing transactions and with judicial and non-judicial real estate foreclosures. In addition, she was designated as one of the Best Lawyers in America ® 2018-2025 for Real Estate Law.


Contact Marisol at 503.228.6044 or mmcallister@fwwlaw.com



Megan Oshiro supports the firm's business, estate and succession planning, financial services and real estate practices. Megan's internship at Willamette's Business Law Clinic, Oregon DOJ in the Financial Fraud and Consumer Protection Section, and externship with the Adidas in-house counsel in Portland bring excellent skills and working knowledge to her practice. Megan was named to the Oregon Super Lawyers Rising Stars 2024 list, an honor bestowed on only 2 1/2 percent of the lawyers in the state, in the primary area of Business and Corporate Law as one of the best attorneys in Oregon under the age of 40 or in practice for less than ten years.

 

Contact Megan at 503.228.6044 or moshiro@fwwlaw.com



Sydney Nguyen practices in several areas including business, estate planning and administration, employment law and real estate, hereby enabling her to assist companies and individuals with a full-range of legal and business challenges.

Contact Sydney at 503.228.6044 or snguyen@fwwlaw.com


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The contents of this publication are intended for general information only and should not be construed as legal advice or opinion on specific facts and circumstances.