From the Editor: there has been significant legal action regarding the stay on the FinCEN, Beneficial Ownership Information (BOI) reporting. Following are a few quotes from the industry regarding the potential upcoming ruling. These are only the opinions of those in the industry, no response has been received yet from the court.
From the AICPA: December 14 Update! The Attorney General filed an emergency motion to stay the injunction preventing Financial Crimes Enforcement Network, US Treasury from enforcing the BOI required reports. This emergency motion has accelerated the timeline creating the possibility of the injunction being lifted by Dec 27. If this were to happen, the Jan 1 deadline would be reinstated and enforceable by FinCEN.
Although we have requested FinCEN to provide an extension of time to file in the event that the injunction is lifted prior to Jan 1, there is no guarantee this will happen. The AICPA still maintains its advice that at a minimum those assisting clients with BOI report filings, gather the required information from the clients and be prepared to file the BOI report if the injunction is lifted.
From FileForms: A significant development occurred in the Texas Top Cop Shop case regarding the Corporate Transparency Act. Attorney General (AG) filed an Emergency Motion to stay the preliminary injunction that currently blocks the CTA’s enforcement. This motion was filed directly with the 5th Circuit Court of Appeals.
In response, the 5th Circuit has ordered the Appellees (Texas Top Cop Shop and others) to file a reply by Tuesday, December 17th. The AG must then reply by noon on December 18th.
While the AG had requested a timeline that would have extended its reply to December 23, the Court expedited the review process, signaling urgency in resolving the matter.
The government is asking the 5th Circuit to consider the following alternatives:
- Stay the entire injunction.
- Stay the injunction with respect to the named plaintiffs, including the 300,000 members of the National Federation of Independent Business.
- Stay the injunction with respect to the named plaintiffs, excluding the 300,000 members of NFIB who are not individually named.
This fast-tracked timeline suggests that the 5th Circuit may issue an order by the December 27th deadline requested by the AG. If granted, the January 1, 2025 BOI filing deadline could be reinstated, and FinCEN would regain the ability to enforce the filing requirements.
The AG’s motion also challenges the broad scope of the nationwide injunction, arguing it exceeds what was requested and what is appropriate. It highlights potential inconsistencies in court rulings across jurisdictions, referencing Supreme Court precedents that support a more targeted approach to injunctions.
This case continues to have significant implications for the 20 million reporting companies affected by the BOI filing requirements. Stay tuned for more updates as the 5th Circuit reviews this urgent matter and it sounds like more clarity is coming quickly
From Mark Friedlich, ESQ, CPA: Overnight, a significant new development occurred in the Texas Top Cop Shop case in the Fifth Circuit.
The Attorney General (AG) filed an Emergency Motion to Stay the preliminary injunction enjoining the Corporate Transparency Act in the Texas Top Cop Shop case directly with the Fifth Circuit Court of Appeals. The appellate court then ordered the Appellees (Texas Top Cop Shop, etc.) to respond by Tuesday, December 17th. The AG must then reply no later than noon on December 18th.
Surprisingly, even though AG's Emergency Motion asked for timing that would have had its reply due by December 23, the Fifth Circuit ordered an even faster review process, with the Appellee's response due on the 17th and the AG's reply due on the 19th.
This indicates to me that the Fifth Circuit likely will issue an order by the December 27th deadline requested by the AG. If the Court grants the motion, theoretically, the January 1 BOI filing date would be reinstated, and FinCEN would be able to enforce the filing requirements.
In short, the motion challenges the broad scope of the nationwide injunction (far more than what was requested and what was appropriate); highlights potential inconsistencies in court rulings across different jurisdictions, and cites Supreme Court precedents supporting a more targeted approach to legal injunctions.
To be clear, this motion does not address the constitutionality of the CTA and Congress’ authority to pass this legislation.
