Whiplash Court Ruling: CTA Filing Requirement for Business Owners is Back on Hold

Corporate Transparency Act (CTA) Update: Reporting Requirement Paused Again

Important update regarding the CTA’s Beneficial Ownership Information (BOI) reporting requirement. On December 26, the Fifth Circuit Federal Court in Texas reversed its own ruling of December 23rd, putting the requirement back on hold. This follows a series of rapid changes, and the constitutionality of the CTA is still being debated. A final resolution may take months.

Who Might Be Required to File?

If the reporting requirement is upheld, filing applies to individuals who formed an entity by filing paperwork with the state. This includes those who:

• Formed a for-profit entity, such as a corporation or partnership.
• Created an LLC to hold assets, such as rental properties.

However, if you don’t own a business or LLC—or if you only have a living trust as part of your estate plan—you are not required to file.

Current Filing Deadlines

At this time, there is no active deadline for BOI reports. Both the initial December 31, 2024, and extended January 13, 2025, deadlines have been suspended.

• If you’d rather wait, that’s a reasonable approach, especially since the CTA may be ruled unconstitutional.
• If you prefer to be proactive and are concerned about missing future deadlines, you can file now, though it’s not currently required.

If You’ve Already Filed

Unfortunately, BOI reports cannot be retrieved once submitted. If the CTA is struck down, we hope the courts will forbid the Treasury from retaining or using that information. If it’s upheld, you’ll need to update your filing within 30 days of any changes to the ownership information to avoid potential criminal penalties.

We’re Here to Help

Navigating the legal system can be challenging, especially when laws like the CTA are in flux. Safe Harbor Estate Law is committed to supporting you through this process. If you have any questions or concerns, feel free to contact your attorney or email Margaret at Margaret@safeharborestatelaw.com.