Corporate Transparency Act Still Blocked Despite Supreme Court Decision

On January 23, the United States Supreme Court issued an order lifting the stay on one of two nationwide injunctions currently in place with respect to enforcement of the CTA.

Following the order, the Financial Crimes Enforcement Network (FinCEN), part of the U.S. Treasury, released a statement, which reads, in part:

As a separate nationwide order issued by a different federal judge in Texas (Smith v. U.S. Department of the Treasury) still remains in place, reporting companies are not currently required to file beneficial ownership information with FinCEN despite the Supreme Court’s action in Texas Top Cop Shop. Reporting companies also are not subject to liability if they fail to file this information while the Smith order remains in force. However, reporting companies may continue to voluntarily submit beneficial ownership information reports.

The CTA applies to privately held and many non-profit entities, including corporations, limited liability companies, limited partnerships, business trusts and other similar entities that are created by the filing of a document with a secretary of state or similar governmental office.

At this point in time reporting remains voluntary, but ICSC continues to monitor ongoing litigation surrounding the CTA closely to see how the new Trump Administration Department of Justice intends to approach the issue.

For more information contact Moutray McLaren at mmclaren@icsc.com.