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Beneficial Ownership Reporting Requirements Temporarily Suspended Nationwide

By: Rob Morris

On December 3, 2024, Judge Amos L. Mazzant of the United States District Court for the Eastern District of Texas issued an order in Texas Top Cop Shop, Inc., et al. v. Merrick Garland, Attorney General of the United States, et al. (Case 4:24-cv-00478-ALM). The order enjoins the enforcement of the Corporate Transparency Act (CTA) nationwide, deeming the CTA likely unconstitutional under the Commerce Clause and the Necessary and Proper Clause of the U.S. Constitution.

Key Points:

  • Nationwide Suspension: Over 32 million entities and individuals previously required to register their Beneficial Ownership Information (BOI) by December 31, 2024, are temporarily relieved of this obligation.

  • Uncertainty Ahead: The Treasury Department has not yet issued guidance. However, for now, most entities required to report are not expected to do so unless and until the stay on the compliance deadline is lifted. If the injunction is lifted, it is anticipated that there will be reasonable notice and an extended deadline to register.

  • Ongoing Monitoring: Legal developments regarding the CTA are fluid, and updates will be necessary as the situation evolves.

Disclaimer: This post is for informational purposes only and does not constitute legal advice. We recommend seeking qualified legal counsel to understand how this development may impact your business.

For more information, contact your attorney or visit our website for updates.