ARTICLE | December 4, 2024

In a pivotal decision on December 3, 2024, a federal district court in Texas has issued a nationwide preliminary injunction blocking enforcement of the beneficial ownership reporting requirements under the Corporate Transparency Act (CTA). The court ruled in Texas Top Cop Shop v. Garland that Congress overstepped its authority, infringing on states’ rights to regulate businesses.

As a result, the Financial Crimes Enforcement Network (FinCEN) cannot enforce the January 1, 2025, reporting deadline for reporting companies nationwide. For now, businesses are NOT required to file beneficial ownership information reports.

While this decision is expected to face appeal, it signals significant uncertainty for compliance efforts under the CTA.  

We will continue to update you as news develops on this issue.