Beneficial Ownership Information: Still On Hold

The Corporate Transparency Act’s requirement to file Beneficial Ownership Information (BOI) is back in the news.

For those who want to skip to the summary, the current status is that the BOI reporting requirement is still suspended pending a Fifth Circuit review.

But last week was really crazy, with the Court of Appeals reinstating the requirement for three days and then once again putting it on hold.

Recent highlights:

• Congress issues the Corporate Transparency Act, which requires most US businesses to file BOI with the federal government by January 1, 2025.
• December 3, 2024: US District Court for the Eastern District of Texas issues a nationwide injunction, halting enforcement of the requirement, suggesting that the requirement is likely to be unconstitutional.
• December 23, 2024: US Court of Appeals for the Fifth Circuit lifts the injunction (“stays” the injunction) (a motions panel), suggesting the government was likely to prevail in defending the law (because the law is likely to be constitutional).
• December 26, 2024: US Court of Appeals for the Fifth Circuit reverses itself (the merits panel), vacating its earlier order to preserve the injunction until after the case can be decided on the merits. The panel explained that it wanted to “to preserve the constitutional status quo while the merits panel considers the parties’ weighty substantive arguments.”