By Kevin Rigdon
As you may be aware, the Corporate Transparency Act (the “Act”) imposes substantial reporting and disclosure requirements on new and existing business entities throughout the country. According to the Act, any business that is subject to its requirements must disclose certain personal information about its beneficial owners. Any person that fails to comply with the Act may be subject to a $500 per day civil penalty, a fine of $10,000 and imprisonment for up to two years.
On December 3, 2024, a federal district court in Texas issued an order granting a nationwide temporary injunction that suspends reporting requirements of the Act and suspends penalties for failure to report. To comply with this injunction, FinCEN now notes on its website that reporting requirements under the Act are no longer mandatory. FinCEN will continue to allow reporting companies to submit voluntary reports, in the discretion of the company. While the U.S. Department of Justice did appeal this injunction order on December 5, 2024, the outcome of that appeal is uncertain, meaning that this suspension is subject to rapid change.
We send this notice to you so that you are aware of the Act and its suspended enforcement. This notice is not intended to be specific legal advice. We urge you to consider reading the Act and acquaint yourself with the ongoing obligations under the Act as those obligations continue to be refined by the Federal Government. Information about the act can be found at https://fincen.gov/boi. If you wish to speak with an attorney related to these obligations, please contact our office to schedule an appointment with one of our attorneys or email us at CTA@bradleyriley.com.
Categories: Business Law, Pressroom