Supreme Court Lifts Nationwide Injunction – BOI Reporting Now Mandatory
On January 24, 2025, the U.S. Supreme Court lifted a nationwide injunction that had previously blocked the enforcement of the Corporate Transparency Act (CTA). This ruling means that businesses must now comply with the mandatory reporting of Beneficial Ownership Information (BOI) to the Financial Crimes Enforcement Network (FinCEN), a division of the U.S. Treasury Department.
The CTA, enacted to combat financial crimes such as money laundering, tax fraud, and illicit financial activities, requires corporations, limited liability companies (LLCs), and other similar entities to disclose information about individuals who directly or indirectly own or control them. The goal of this regulation is to enhance transparency and prevent the misuse of anonymous corporate structures for illegal purposes.
The decision to reinstate the reporting requirement comes after legal challenges temporarily delayed its enforcement. Small business advocacy groups and privacy advocates had argued that the CTA imposed an undue burden on smaller companies and raised concerns about data security and privacy. Despite these objections, the Supreme Court’s ruling now mandates compliance, meaning that affected entities must begin or continue submitting their ownership details as required under the law.
For business owners, this decision underscores the importance of understanding and adhering to the BOI reporting requirements. Companies failing to comply may face penalties, including fines and other enforcement actions. Businesses should review their reporting obligations and, if necessary, seek legal or professional guidance to ensure compliance with the reinstated regulations.
With the CTA now in effect, federal agencies are expected to ramp up efforts to enforce compliance, while legal challenges to the law may continue. However, until any further legal rulings alter its implementation, companies must now operate under the assumption that BOI reporting is mandatory moving forward.
Sources:
https://www.reuters.com/legal/us-supreme-court-allows-anti-money-laundering-law-take-effect-2025-01-23
https://www.journalofaccountancy.com/news/2025/jan/supreme-court-lifts-boi-injunction-filing-timeline-unclear.html
https://www.akerman.com/en/perspectives/the-us-supreme-court-lifts-stay-of-enforcement-of-the-corporate-transparency-act-yet-reporting-requirements-remain-voluntary.html
