Beneficial Ownership Reporting is Back on the Menu. Well...almost.

The Supreme Court on January 23rd, 2025 made a decision to grant the federal government a motion to stay for the case, Texas Top Cop Shop, Inc. v. McHenry—formerly, Texas Top Cop Shop v. Garland, which was one of two cases pausing the requirement for Beneficial Ownership Reporting as part of the Corporate Transparancy Act, or CTA, which was due to start racking up eye watering fines for the federal government at the beginning of 2025.

The CTA was signed into law back in 2021 to combat money laundering, tax evasion, and trafficking to name a few. The information that is submitted to the Financial Crimes Enforcement Network (finCEN) is meant to only be disclosed to authorized government authorities and financial institutions. 

The required information would have been used to disclose the owners of more than 25% of any business, or a beneficial owner. Most small business entities which have filed with their Secretary of State, mostly Limited Liability Companies and Corporations, would have been required to file this report and to keep them up to date in case of any ownership changes, including address change of any owners within 30 days of said change. 

The US Supreme Court granting the motion to stay means nothing in the immediate, as there is a separate case, Smith v. U.S. Department of the Treasury, that also paused enforcement of this reporting, which has yet to be decided. It does mean the federal government is one step closer to enforcing the Beneficial Ownership Information requirements though. Businesses can still file these reports voluntarily to ensure that they are not caught offguard if the second case is decided in favor of the federal government.

All businesses are able to do this reporting themselves and FinCEN even provides a guide on how to do it: