The Corporate Transparency Act Is Back With An Extended Deadline

At a Glance

• On Tuesday, February 18, 2025, the U.S. District Court for the Eastern District of Texas in Smith, et al. v. U.S. Department of the Treasury, et al. issued a ruling that lifted the last national injunction against the enforcement of the Corporate Transparency Act (CTA).
• On Wednesday, February 19, 2025, the Department of the Treasury and the Financial Crimes Enforcement Network (FinCEN) released additional guidance specifying that CTA filings for most reporting companies will now be due by March 21, 2025. Reporting companies that have a filing deadline that is after the March deadline should file by the applicable later deadline.
• FinCEN reserved the right to extend the March deadline should it determine that reporting companies need additional time to comply. FinCEN did not specify factors to be considered in making this determination.
• The injunction in the case styled National Small Business United v. Yellen is still in effect.
• Short of congressional action to repeal the CTA or modify its compliance deadline, reporting companies (i.e., nonexempt companies) should plan to make all CTA filings by the applicable deadline.

If you have been following the CTA recently, you know there has been no shortage of wild swings in its status. The on-again and off-again law has been the subject of numerous legal challenges around the country. In the latest ruling, the U.S. District Court for the Eastern District of Texas lifted the last national injunction against the CTA’s enforcement on Tuesday, February 18, 2025.¹In response, on Wednesday, February 19, 2025, FinCEN released additional guidance extending the filing deadline for most reporting companies to March 21, 2025. FinCEN has indicated that this deadline may be extended should it determine that reporting companies need additional time to comply, but it has shed no light on what it will consider in making this determination and whether any such determination would apply to some or all reporting companies. However, FinCEN has said it will “prioritize[e] reporting for those entities that pose the most significant national security risks.”²It is not clear which reporting companies fit into this category.

Summary of Applicable Deadlines

FinCEN acknowledged that reporting companies may have a filing deadline that is later than the new March deadline if, for example, the reporting company qualifies for a disaster relief extension; however, FinCEN has not provided updated guidance about other circumstances under which a later due date may apply. Under the current CTA rules and setting aside FinCEN’s latest guidance, CTA filings are due within 30 days of formation (in the case of domestic nonexempt companies formed in 2025) or registration to do business in any U.S. jurisdiction (in the case of foreign nonexempt companies registered in 2025). The below table summarizes current filing deadlines for initial reports (not corrected or updated reports) taking into account the new March deadline.

*This date could vary if, for example, the reporting company qualifies for disaster relief extensions.

**In our prior alert regarding the case styled National Small Business United v. Yellen, we discussed that FinCEN announced that it will not enforce the CTA against the plaintiffs in that action, namely, Isaac Winkles, reporting companies for which Isaac Winkles is the beneficial owner or applicant, the National Small Business Association, and members of the National Small Business Association as of March 1, 2024. FinCEN maintains this view in its latest guidance.

Potential Outlook and Next Steps

Recall the McHenry v. Texas Top Cop Shop case,³ which questions the constitutionality of the CTA, is currently pending before a merits panel of the Fifth Circuit Court and, in response to FinCEN’s emergency stay application, the U.S. Supreme Court granted a stay lifting the injunction in the Fifth Circuit Texas Top Cop case.⁴ The Supreme Court’s stay will remain in place pending the disposition of the Fifth Circuit Texas Top Cop case or the disposition of a petition for writ of certiorari (should one be timely filed). If the Supreme Court denies certiorari, its stay automatically terminates. In addition to the Texas Top Cop case, there are other cases currently pending, including the Smith case, which was appealed to the Fifth Circuit. It is not clear whether the Fifth Circuit Smith case will be consolidated with the Fifth Circuit Texas Top Cop case or rendered moot by its outcome.

Oral arguments in the Fifth Circuit McHenry case are scheduled for March 25, 2025, which means the Fifth Circuit’s ruling will not be issued prior to the new March 21, 2025 filing deadline. It is possible that the CTA could be repealed or amended by congressional action⁵; however, short of that, reporting companies should continue to monitor legal updates and plan to make CTA filings by the applicable deadline.