Mid-series update: this post covers the December 2024 developments that interrupted CTA reporting. The position changed again in January and again in March; for the current state of play, see our March 2025 update.
On December 3, 2024 — less than four weeks before the original December 31 reporting deadline — a federal district court for the Eastern District of Texas issued a nationwide preliminary injunction in Texas Top Cop Shop, Inc. v. Garland, blocking the federal government from enforcing the Beneficial Ownership Information (BOI) reporting requirements of the Corporate Transparency Act.
What the court did.
The plaintiffs in Texas Top Cop Shop challenged the constitutionality of the CTA on several grounds, including the argument that requiring private companies to disclose ownership to a federal database exceeds the powers Congress can exercise over intrastate business. The district court agreed at the preliminary injunction stage, ruling that the plaintiffs had shown a likelihood of success on the merits and were entitled to relief that protected not only the named plaintiffs but reporting companies nationwide.
The court’s injunction was sweeping: it stopped FinCEN from enforcing the BOI reporting requirement against any reporting company while the litigation continued. As a practical matter, this meant the December 31, 2024 deadline was suspended.
The DOJ appeals.
The Department of Justice immediately filed notice of appeal to the U.S. Court of Appeals for the Fifth Circuit on December 5, 2024, and asked the district court for a stay of its own injunction pending appeal — which the district court denied on December 13, 2024. The DOJ then took the stay request to the Fifth Circuit. As of mid-December, the injunction was in effect, the DOJ’s motion for stay was pending in the appeals court, and reporting companies were not required to file.
What this meant for clients.
FinCEN itself responded by clarifying that, while the injunction was in effect, reporting companies were not subject to liability for failing to file by the original deadline — though they remained free to file voluntarily. For most of our small business clients, the practical advice in late December 2024 was: hold off on filing while the injunction was in place, but be ready to file quickly if the injunction was reversed on appeal.
That posture proved correct — the situation moved fast. The Fifth Circuit ruled on the stay motion within weeks. The January 2025 update walks through what happened next.
The deeper question.
The constitutional challenge to the CTA raised a real question about how far Congress can reach into the regulation of small private businesses formed under state law. Several other district courts had previously upheld the law against similar challenges. The Eastern District of Texas was the first to issue an injunction with nationwide effect. The split among district courts — combined with the magnitude of the compliance burden being suspended — effectively guaranteed that the case would reach an appeals court quickly.
Quick FAQ.
Did I have to file my BOI report after the December injunction? No. While the injunction was in effect, reporting companies were not required to file. Voluntary filing remained an option but was not required.
Was the original Dec 31, 2024 deadline still in effect? Effectively, no. The injunction suspended the deadline. FinCEN itself confirmed that companies that didn’t file by Dec 31 wouldn’t face liability while the injunction stood.
What if I had already filed? Your filing wasn’t affected. FinCEN retained the data; the injunction blocked enforcement going forward, not retroactively.
What did the appeals court do? The Fifth Circuit’s subsequent reinstatement of the BOI requirement, and the eventual March 2025 rewrite, are covered in our January and March updates. The bottom line: if you’re a U.S. domestic small business, current rules effectively exempt you. Reach out if you’re uncertain.