Important Update: Federal Court Halts Enforcement of Corporate Transparency Act Filing Requirements 

On December 3, 2024, a major legal development occurred regarding the Corporate Transparency Act (CTA) that affects businesses across Ohio and the U.S. In the case Texas Top Cop Shop, Inc. et al. v. Garland, a federal district court in Texas issued a preliminary injunction that temporarily halts the enforcement of the CTA’s requirement for certain businesses to file Beneficial Ownership Interest Reports (BOIRs). This ruling provides temporary relief for companies that were originally required to meet the filing deadline of December 31, 2024. Read the full order here. 

What Does This Mean for Ohio Businesses? 

Under the CTA, businesses created before 2024 were required to report their beneficial owners to the Financial Crimes Enforcement Network (FinCEN) by the end of 2024. Failure to comply with these reporting requirements could result in significant penalties. However, the court’s preliminary injunction pauses the enforcement of these requirements for now, providing business owners with more time before they are potentially required to file these reports. 

The court’s decision does not strike down the law entirely. Rather, it temporarily halts enforcement while the legal challenges to the CTA are resolved. The court expressed that the CTA and the Beneficial Ownership Information (BOI) Reporting Rule are “likely unconstitutional” for the purposes of issuing a preliminary injunction, but this is not a final ruling on the law’s constitutionality. 

How Does This Affect Your Business? 

If you are an entity owner in Ohio and were preparing to meet the December 31 deadline, this injunction offers temporary relief. The nationwide halt on enforcement means that you no longer need to submit your BOIR to FinCEN by the original deadline—at least for now. 

However, this is a temporary measure. Preliminary injunctions are not permanent and only preserve the status quo until the underlying legal issues are resolved. Therefore, it is crucial for business owners to remain informed about the progress of this case and other legal challenges to the CTA, as further developments could impact your compliance obligations. 

What Should You Do Next? 

Even though enforcement has been paused, business owners should continue to monitor the situation closely. The outcome of this case and other related challenges could ultimately lead to a change in the law or its enforcement requirements. Mulhall Zion LLC is committed to keeping our clients informed of any significant changes and providing timely updates as they arise. 

Questions? Feel Free to Reach Out! 

If you have questions about how this injunction may affect your business or if you need assistance with compliance under the Corporate Transparency Act, please do not hesitate to reach out to our team. We are here to help you navigate these changes and ensure your business stays on track. 

Our team at Mulhall Zion LLC will be monitoring the situation closely and will provide updates as they happen.