Court Ruling Resets Deadline for Business Ownership Reporting

February 18, 2025 — A federal judge in Texas has reinstated the beneficial ownership information reporting requirement for small businesses, a ruling that could impact countless companies across the country. On February 17, the Eastern District of Texas lifted a preliminary injunction that had halted enforcement of the Corporate Transparency Act amid ongoing legal disputes.

This ruling comes as the Department of Treasury appeals a decision in the Smith v. Treasury Department case. Following the lifted injunction, businesses must now comply with the reporting requirements, with a new filing deadline set for March 21, 2025.

The Financial Crimes Enforcement Network (FinCEN), which oversees the law’s enforcement, had previously suspended the requirements but is now moving forward with plans to streamline and modify the reporting process. According to a spokesperson for the Treasury Department, the agency aims to alleviate the burden on low-risk entities while still prioritizing national security.

“Assessing options to change requirements aligns with our commitment to reducing regulatory burdens on businesses,” the spokesperson stated. However, it remains unclear which businesses will qualify as low-risk under the new guidelines.

This comes after a series of legal battles that began late last year when a Texas judge temporarily halted the reporting requirement just weeks before the deadline of January 1, 2025. Although the Supreme Court has put a stay on these rulings pending the outcome of a similar case from Texas Top Cop Shop, the Smith injunction had kept the reporting requirements from taking effect until now.

As small businesses prepare for the new deadlines, organizations such as the Owner-Operator Independent Drivers Association (OOIDA) are advising members to be cautious. The OOIDA Compliance Department has warned truckers about fraudulent services charging fees to file the beneficial ownership information report. “There is no fee if you file directly at FinCEN’s site,” they clarified.

Under the Corporate Transparency Act, the filing requirement targets small businesses that employ fewer than 20 employees and are incorporated. Sole proprietorships and partnerships that are not incorporated are typically excluded from the requirement.

Additional details about the reporting requirements and timelines can be found on the FinCEN website as the situation continues to evolve. Stakeholders are encouraged to prepare for the March deadline, especially while awaiting further guidance that FinCEN is expected to release.

This developing story will be updated as new information becomes available.