Corporate Transparency Act Reporting Obligations Back In Effect With Extension

Reporting obligations related to the Corporate Transparency Act ("the CTA") are set to return. As we previously reported, on December 3, 2024, a federal judge in Texas (Texas Top Cop Shop, Inc. v. Bessent) issued a nationwide preliminary injunction preventing the federal government from enforcing the CTA. The U.S. Court of Appeals for the Fifth Circuit expedited briefing on the merits and left that injunction in place, but the U.S. Supreme Court ultimately stayed the effect of that injunction on January 23, 2025. The reporting obligations did not immediately spring back into effect, however, because a different federal judge in Texas (Smith v. U.S. Department of the Treasury) had issued a nationwide preliminary injunction in a separate case. On February 18, 2025, that district court stayed the effect of its preliminary injunction based on the Supreme Court's January 23 stay.