To Report or Not to Report – Have you gotten whiplash yet?!

In early December, I had blogged that a Federal Court sitting in Texas had ruled that the Corporate Transparency Act was “likely unconstitutional” and stayed the reporting requirement. Now the Fifth Circuit Court of Appeals has stayed the stay so nonexempt companies are again required to report on or before January 1, 2025. Confused yet?

To review, the Corporate Transparency Act (“CTA”) obliges certain nonexempt companies to report the identity of their owners (or in the Association world, the identities of the Board members). The reporting is accomplished by filing a report – called a Beneficial Ownership Information (“BOI”) report – with the Treasury Department’s Financial Crimes Enforcement Network (“FinCEN”).

In a lawsuit filed in the Eastern District of Texas, the trial court preliminarily ruled that the “CTA is likely unconstitutional as outside of Congress’s power.” The trial court then enjoined enforcement of the CTA and stayed the January 1, 2025 reporting deadline. On appeal, the appellate court stayed the trial court’s injunction – the effect is to re-establish the January reporting deadline.

But also note that FinCEN extended the reporting deadline for victims of Hurricane Milton. For businesses located in the following counties, the deadline has been extended by 6 months to July 1, 2025. The Florida counties benefiting from this 6 month extension are – Brevard, Charlotte, Citrus, Collier, DeSoto, Duval, Flagler, Glades, Hardee, Hendry, Hernando, Highlands, Hillsborough, Indian River, Lake, Lee, Manatee, Marion, Okeechobee, Orange, Osceola, Palm Beach, Pasco, Pinellas, Polk, Putnam, Sarasota, Seminole, St. Johns, St. Lucis, Sumter and Volusia.

So if your Association has not yet reported (and is located in one of the affected Florida counties), sit tight to see how things develop in the Texas courts. Otherwise, we’re down to the wire for timely filing on or before January 1, 2025.