UPDATE: 1/23/25 – The Supreme Court has stayed the injunction allowing for enforcement of the Corporate Transparency Act’s requirement that beneficial owners register with FinCEN while the case is being decided by the 5th Circuit, which is slated to hear arguments on March 25, 2025. Once again tax professionals will be scrambling to get their clients updated on the law and registered.

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Last week the 5^th Circuit Court of Appeals reversed its earlier ruling that reinstated the Corporate Transparency Act’s requirement that beneficial owners must register with FinCEN (the Financial Crimes Enforcement Network), which was a reversal of the U.S. District Court for the Eastern District of Texas that had granted a preliminary injunction to prevent the requirement for registration from going into effect on January 1, 2025. If this all seems pretty confusing, you get it. Advisors have a bad case of whiplash as one panel of the 5^th Circuit reinstated the injunction after another panel had initially overruled the Texas decision. Even Congress contemplated wading into the mess by including a one year delay in the effective date of the registration requirement, although ultimately the bill that passed to avoid a government shutdown did not contain the provision. Now the Department of Justice has appealed the injunction to the Supreme Court, making the case that the burdens imposed by the law are minimal and likely to be found constitutional. The appeal alternatively argues that the injunction if left in effect, should be limited to only the parties to the original case. If either request is granted, beneficial owners may be required to file reports again on short notice as the deadline was extended by FinCEN after the Texas Court’s reversal, but only until January 13, 2025. Interestingly the Department of Justice also asked the Court to treat its filing as a petition for writ of certiorari before judgment, which would ask the Supreme Court to agree to hear the case before the 5^th Circuit has rendered a decision on the merits. Briefs are due at the Supreme Court on January 10, 2025.

It is anybody’s guess how the Supreme Court will decide to handle the case and whether the new administration, due to be sworn in on January 20, 2025, will join the fray, but one thing is for certain – it couldn’t possibly get messier. Click here to see the Supreme Court application in Texas Top Cop Shop and here to read about the implications if the Texas ruling were to be upheld.