Just days after reinstating beneficial owner information reporting requirements under the Corporate Transparency Act, the merits panel of the Fifth Circuit Court of Appeals has reversed course.

This means that the requirement to file BOI information has again been temporarily suspended for all businesses nationwide.

The court clerk filed an order on December 26 stating:

The merits panel now has the appeal, which remains expedited, and a briefing schedule will issue forthwith. However, in order to preserve the constitutional status quo while the merits panel considers the parties’ weighty substantive arguments, that part of the motions-panel order granting the Government’s motion to stay the district court’s preliminary injunction enjoining enforcement of the CTA and the Reporting Rule is VACATED. 

On December 23, the court had nullified an earlier injunction, allowing the Treasury Department’s Financial Crimes Enforcement Network (aka FinCEN) to resume enforcement of the CTA and its beneficial ownership information reporting requirements, with a modified deadline.

As the legal wrangling continues, it’s highly likely that more changes will come. The vast majority of PPAI’s roughly 15,000 member companies would be subject to this reporting requirement, should it be reinstated. Businesses may choose to wait and see, or to file voluntarily to stay ahead of any future reinstatement of the filing requirement.

  • Failure to comply can trigger civil penalties (up to roughly $600 per day) and criminal penalties (up to two years’ imprisonment and a fine of up to $10,000).
  • Both individuals and corporate entities can be held liable for “willful violations.”

ICYMI: BOI Reporting Requirements: What Small Businesses Need To Know

Monitor FinCEN’s BOI page for updates and revised instructions. Filing can be completed for free online by going to the BOI e-filing website and selecting “Get Started” at upper right or “File BOIR” at bottom left.

For questions or suggestions on regulatory or government affairs issues, please contact Rachel Zoch at RachelZ@ppai.org.