Update 12.27.2024
A U.S. appeals court has halted enforcement of an anti-money laundering law that requires corporate entities to disclose the identities of their real beneficial owners to the U.S. Treasury Department ahead of a deadline for most companies to do so.
The New Orleans-based 5th U.S. Circuit Court of Appeals
reinstated, opens new tab late Thursday a nationwide injunction that had been issued this month by a federal judge in Texas who had concluded the Corporate Transparency Act was unconstitutional.
Stay Tuned!
Hey, Warriors and Bosses!
In a significant development that affects millions of business owners across the United States, the Fifth Circuit Court of Appeals has lifted the nationwide preliminary injunction on the Corporate Transparency Act (CTA), putting reporting requirements back in motion. This latest update, occurring on December 23, 2024, means business owners need to pivot back to compliance mode quickly.
What Does This Mean for Your Business?
The reinstatement of the CTA enforcement means that the January 1, 2025, deadline for beneficial ownership information reports is once again active. This comes after a brief period of uncertainty when a federal court in Texas had halted the implementation of the Act just weeks before its original enforcement date.
This legal rollercoaster began on December 3, 2024, when the U.S. District Court for the Eastern District of Texas issued a preliminary injunction that temporarily suspended the CTA’s enforcement. The U.S. Department of Justice quickly responded by filing an appeal
This led to the current situation where the Fifth Circuit reversed the injunction.
If your company hasn’t prepared for CTA compliance, acting quickly is crucial. During the brief period when the injunction was in place, many businesses may have paused their compliance efforts. However, as the Fifth Circuit’s decision demonstrates, companies must be ready to disclose on short notice.
Lifting the injunction means that 2025 CTA reporting deadlines are now enforceable for all reporting companies. Business owners should work with their legal and compliance teams to ensure they’re prepared to meet these reinstated obligations.
Remember, staying informed and maintaining readiness for compliance is key in this evolving regulatory landscape. Consider consulting with legal professionals to ensure your business meets all CTA requirements by the deadline.
Be Audit-Secure™!
Lisa Smith, SPHR, SCP
Note: This blog post is for informational purposes only and should not be construed as legal advice. Always consult with a legal professional for advice specific to your situation.
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