On August 29, 2024, the Financial Crimes Enforcement Network (“FinCEN”) published the Anti-Money Laundering Regulations for Residential Real Estate Transfers (“Residential Real Estate Rule”), which regulations went into effect on December 1, 2025. On September 30, 2025, FinCEN announced a blanket exemption from the reporting requirements of the Residential Real Estate Rule until March 1, 2026. Note, FinCEN’s announcement does state that any Real Estate Geographic Targeting Orders remain in effect.

The Residential Real Estate Rule requires certain persons to report non-financed transfers of residential real property to entities and trusts, on a nationwide basis. The aim of the Residential Real Estate Rule is to further the Bank Secrecy Act (31 USC §5311 et seq.) (“BSA”) and assist law enforcement and national security agencies in addressing illicit finance risks posed by criminals and malign actors in laundering ill-gotten gains through transfers of residential real property. Currently, most residential real estate transactions involve mortgage loans or other financing from financial institutions that are subject to other anti-money laundering reporting requirements under the BSA.

Looking ahead to when compliance with the Residential Real Estate Rule is necessary, below is a brief summary of the Residential Real Estate Rule.

What is “residential real property” under the Residential Real Estate Rule?

Residential real property means:

(i) real property located in the United States containing a structure designed principally for occupancy by one to four families;

(ii) land located in the United States on which the transferee intends to build a structure designed principally for occupancy by one to four families;

(iii) a unit designed principally for occupancy by one to four families within a structure on land located in the United States (e.g. a condominium unit); or

(iv) shares in a cooperative housing corporation for which the underlying property is located in the United States.

What is a “reportable transfer” under the Residential Real Estate Rule?

A reportable transfer is a non-financed transfer to a transferee entity or transferee trust of an ownership interest in residential real property. There is no requirement that all of the ownership interest be transferred in order for the transfer to be a reportable transfer.

A reportable transfer does not include a transfer:

(i) of an easement (including a grant or revocation);

(ii) resulting from the death of an individual, whether pursuant to the terms of a decedent’s will or the terms of a trust, operation of law, or by contract;

(iii) incident to divorce or dissolution of a marriage or civil union;

(iv) to a bankruptcy estate;

(v) supervised by a court in the United States;

(vi) for no consideration made by an individual, either alone or with their spouse, to a trust of which such individual, their spouse, or both, are the settlor(s) or grantor(s);

(vii) to a qualified intermediary for purposes of a 1031 exchange (26 CFR 1.1031(k)–1); or

(viii) for which there is no reporting person.

What is a “non-financed transfer” under the Residential Real Estate Rule?

The term ‘‘non-financed transfer’’ means a transfer that does not involve an extension of credit to all transferees that is: (i) secured by the transferred residential real property; and (ii) extended by a financial institution that has both an obligation to maintain an anti-money laundering program and an obligation to report suspicious transactions.

Thus, a Residential Real Estate Report will have to be filed with FinCEN, even if a transfer involves: (a) financing from a hard money lender, or (b) a private loan or similar loan situation, where the creditor does not have separate obligations to report under the BSA (for instance, suspicious activity reports or other anti-money laundering reports).

What is a “transferee entity” under the Residential Real Estate Rule?

The term ‘‘transferee entity’’ means any person other than a transferee trust or an individual. For example, a corporation, a limited liability company, a partnership, an association or an estate.

A transferee entity does not include:

(i) securities reporting issuers;

(ii) governmental authorities;

(iii) banks;

(iv) credit unions;

(v) depository institution holding companies;

(vi) money services businesses;

(vii) brokers and dealers in securities;

(viii) securities exchanges and clearing agencies;

(ix) other Exchange Act registered entities;

(x) insurance companies;

(xi) state-licensed insurance producers;

(xii) Commodity Exchange Act registered entities;

(xiii) public utilities;

(xiv) financial market utilities;

(xv) pooled investment vehicles; and

(xvi) controlled or wholly owned subsidiaries of any of the above.

What is a “transferee trust” under the Residential Real Estate Rule?

The term ‘‘transferee trust’’ means any legal arrangement created when a person (generally known as a grantor or settlor) places assets under the control of a trustee for the benefit of one or more persons (each generally known as a beneficiary) or for a specified purpose, as well as any legal arrangement similar in structure or function to the above, whether formed under the laws of the United States or a foreign jurisdiction.

A transferee trust does not include:

(i) a trust that is a securities reporting issuer;

(ii) a trust in which the trustee is a securities reporting issuer;

(iii) a statutory trust, which means any trust created or authorized under the Uniform Statutory Trust Entity Act or as enacted by a State; or

(iv) an entity wholly owned by a trust described above.

Who is a “reporting person” under the Residential Real Estate Rule?

The reporting person for a reportable transfer is the person engaged within the United States as a business in the provision of real estate closing and settlement services that is:

(i) the person listed as the closing or settlement agent on the closing or settlement statement for the transfer (e.g. title company, attorney or real estate broker);

(ii) if no person described above is involved in the transfer, then the person that prepares the closing or settlement statement for the transfer;

(iii) if neither of the above is involved, then the person that files with the recordation office the deed or other instrument that transfers ownership of the residential real property;

(iv) if none of the above is involved, then the person that underwrites an owner’s title insurance policy for the transferee with respect to the transferred residential real property, such as a title insurance company;

(v) If none of the above is involved, then the person that disburses in any form, including from an escrow account, trust account, or lawyers’ trust account, the greatest amount of funds in connection with the residential real property transfer;

(vi) If none of the above is involved, then the person that provides an evaluation of the status of the title; or

(vii) If none of the above is involved, then the person that prepares the deed or, if no deed is involved, any other legal instrument that transfers ownership of the residential real property, including, with respect to shares in a cooperative housing corporation, the person who prepares the stock certificate.

If an employee, agent, or partner acting within the scope of such individual’s employment, agency, or partnership would be the reporting person, then the individual’s employer, principal, or partnership is deemed to be the reporting person. A financial institution that has an obligation to maintain an anti-money laundering program is not a reporting person.

Alternatively, the reporting persons may enter into an agreement with any other person described above as a reporting person to designate such other person as the reporting person with respect to the reportable transfer. If reporting persons decide to use designation agreements, a separate written agreement is required for each reportable transfer and all parties must maintain a copy of such designation agreement for five years.

What information about the transferee must be reported?

The following information must be reported for the transferee:  (i) full legal name (including any trade names or DBAs); (ii) current street address that is the entity’s principal place of business (if such address is not located in the US, then the report must also include the street address for the primary business location in the US); and (iv) a unique identifying number (such as a tax identification number). For transferee trusts, the report must also include: (a) the date the trust instrument was executed and (b) whether such trust is revocable.

Additionally, each beneficial owner (as such term is defined under the Corporate Transparency Act and its regulations) of the transferee must report, such individual’s: (1) full legal name; (2) date of birth; (3) current residential street address; (4) citizenship; and (5) unique identifying number (such as a tax identification number). The same information must also be reported for each individual signing on behalf of such transferee and also include the signing individual’s capacity in which it’s acting, and if such capacity is as an employee, agent or partner, then the name of such employer, principal or partnership.

What other information about the reportable transfer must be reported?

The Residential Real Estate Report must also include information about the transferor, the subject residential real property, the total consideration paid in connection with the reportable transfer, and the payment information. The transferor information includes most of the same information as described above for the transferee, except the report does not need to include the beneficial owner or signing individual information for the transferor. The residential real property information includes the street address, the legal description (such as section, block and lot), and the date of the closing. Additionally, the report must include certain information about the payments made by or on behalf of the transferee for the reportable transfer, including (i) each payment amount, (ii) each payment method (e.g. wire transfer), (iii) if paid from an account held at a financial institution, then such financial institution’s name and account number, and (iv) the name of any payor that is not the transferee. If the reportable transfer involves financing from a hard money lender or another private lender, then such lender must be included in the Residential Real Estate Report.

When must the Residential Real Estate Report be filed with FinCEN?

A reporting person is required to file a Real Estate Report by the later of either: (i) the final day of the month following the month in which the date of closing occurred; or (ii) 30 calendar days after the date of closing.

Where must the Residential Real Estate Report by filed?

The Residential Real Estate Report must be filed electronically with FinCEN. Here is a link to a sample of the Residential Real Estate Report online filing.

What are the penalties for failure to comply with the Residential Real Estate Rule?

Although the Residential Real Estate Rule does not specify penalties for failure to comply, FinCEN has stated that the statutory penalties for failure to comply would apply here, including civil penalties and potentially imprisonment for willful violations.

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For further information or guidance on your real estate transactions, please contact Leslie Feifer or our Real Estate Practice Group.

As covered in our Transparency-is-in-Your-Future series, on December 22, 2023, New York Governor Kathy Hochul signed into law the LLC Transparency Act (the “NY LLCTA”), requiring the disclosure of beneficial ownership information to the New York Department of State (“NY DOS”) by limited liability companies formed under the laws of the state of New York and foreign limited liability companies authorized to do business in the state of New York. The NY LLCTA takes effect on January 1, 2026, and is largely based on the federal Corporate Transparency Act (“CTA”). However, earlier this year, the U.S. Treasury Department announced the suspension of CTA enforcement against U.S. citizens and domestic reporting companies, while the Treasury’s Financial Crimes Enforcement Network (“FinCEN”) develops new regulations. Although the notice and comment period for FinCEN’s proposed interim final rule ended in May 2025, FinCEN has still not issued the final rule as of September 25, 2025.

The proposed changes to the CTA have caused conflicts in the NY LLCTA, which lead the New York State Congress to propose a bill amending the NY LLCTA (the “Proposed Amendment”). The Proposed Amendment has passed both the New York State Senate and the New York State Assembly and is currently waiting to be called for delivery to Governor Hochul for execution. Below is a brief summary of the amendments to the NY LLCTA if the Proposed Amendment were to be signed into law.

What entities will have to file if the Proposed Amendment becomes law?

Any domestic limited liability company that is formed under the laws of the state of New York and any foreign limited liability company that has filed an application for authority with the NY DOS will have to file a beneficial ownership disclosure with the NY DOS, unless it meets an exemption as discussed below. Furthermore, exemption under the NY LLCTA is not automatic – in order to become exempt, a member or manager of the limited liability company will have to sign a statement of exemption and file such statement with the NY DOS. The NY LLCTA does not affect corporations or limited partnerships, which are also formed by filings with the NY DOS, and already have different applicable reporting requirements.

Under the current NY LLCTA, a “reporting company” is defined as a limited liability company covered under the CTA (31 U.S.C.  § 5336(a)(11)), as amended, and any regulations promulgated thereunder, provided that such limited liability company is formed or authorized to do business in New York state.

The Proposed Amendment would amend the definition of “reporting company” to “mean a limited liability company that is: (i) created by the filing of a document with the secretary of state; or (ii) authorized to do business in this state”. Furthermore, the definition of “reporting company” does not mean or include:

(i) a securities issuer under the Federal Securities Exchange Act of 1934 (the “SEC Act”);

(ii) an entity that exercises governmental authority on behalf of a municipality, agency, authority, political subdivision of the state;

(iii) banking organizations, including banks, credit unions, bank holding companies, savings and loan holding companies, registered money transmitting businesses, or licensees as defined by the banking law, and registered brokers or dealers in securities;

(iv) an exchange or clearing agency under the SEC Act;

(v) any other registered securities exchange entity not described in subparagraphs (i), (vii), or (viii) that is under the SEC Act;

(vi) a registered investment company under the Federal Investment Company Act of 1940 (the “ICA”) or a registered investment adviser under the Federal Investment Advisers Act of 1940 (the “IAA”);

(vii) an investment adviser: (A) under section 203(l) of the IAA and that has completed certain filings with the SEC; or (B) as defined in article 23-A of the general business law.

(viii) an insurance company, as defined in the ICA;

(ix) an insurer that is authorized by the state and subject to supervision by the commissioner of financial services, and has an operating presence within New York state;

(x) a registered entity under the Federal Commodity Exchange Act;

(xi) a public accounting firm registered under the Federal Sarbanes-Oxley Act of 2002;

(xii) a public utility corporation that provides telecommunications services, electrical power, natural gas, or water and sewer services within the state;

(xiii) a financial market utility designated under the Federal Payment, Clearing, And Settlement Supervision Act of 2010;

(xiv) any pooled investment vehicle that is operated or advised by certain banking organizations in subparagraph (iii), or subparagraphs (v) or (vi);

(xv) certain tax-exempt entities under the Federal Internal Revenue Code of 1986;

(xvi) any limited liability company that: (A) operates exclusively to provide financial assistance to, or hold governance rights over, any entity described in subparagraph (xiv); (B) is a U.S. resident; (C) is beneficially owned or controlled exclusively by one or more U.S. residents that are U.S. citizens or lawfully admitted for permanent residence; and (D) derives at least a majority of its funding or revenue from one or more U.S. residents that are U.S. citizens or lawfully admitted for permanent residence;

(xvii) any entity that: (A) employs more than 20 employees on a full-time basis in the U.S.; (B) filed in the previous year Federal income tax returns in the U.S. demonstrating more than $5,000,000 in gross receipts or sales in the aggregate; and (C) has an operating presence at a physical office within the state;

(xviii) any limited liability company of which the ownership interests are owned or controlled, directly or indirectly, by one or more entities described in subparagraphs (i), (ii), (iii), (iv), (v), (vii), (viii), (ix), (x), (xi), (xii), (xiii), (xv) or (xvii);

(xix) any limited liability company: (A) in existence for over one year; (B) that is not engaged in active business; (C) that is not owned, directly or indirectly, by a foreign person; (D) that has not, in the preceding 12-month period, experienced a change in ownership or sent or received funds in an amount greater than$1,000, including through a financial account or accounts in which the entity, or an affiliate of the entity, maintains an interest; and (E) that does not otherwise hold any kind or type of assets, including an ownership interest in any limited liability company; and

(xx) any entity or class of entities that the NY DOS, by regulation, determined should be exempt because requiring beneficial ownership information from the entity or class of entities: (A) would not serve the public interest; and (B) would not be highly useful in national security, intelligence, and law enforcement agency efforts to detect, prevent, or prosecute money laundering, the financing of terrorism, proliferation finance, serious tax fraud, or other crimes.

The current NY LLCTA defines “exempt company” to have the same meaning as under the CTA ((31 U.S.C. § 5336(A)(11)(B), which exempts most financial services institutions, including investment and accounting firms, securities trading firms, banks, and credit unions that report to and are regulated by government agencies such as the SEC, or the FDIC, as well as tax exempt organizations, large operating companies, and certain inactive entities.

The Proposed Amendment would amend the definition of “exempt company” to “mean a limited liability company or foreign limited liability company not otherwise defined as a reporting company.” The definition should have stopped there, however, the New York State legislature added that an exempt company must:

“meet[] one or more of the following conditions:

(1) a minor child, which shall mean an individual under the age of eighteen;

(2) an individual acting as a nominee, intermediary, custodian, or agent on behalf of another individual;

(3) an individual acting solely as an employee of a limited liability company, and whose control over or economic benefits from such entity is derived solely from the employment status of the person;

(4) an individual whose only interest in a limited liability company, is through a right of inheritance; or

(5) a creditor of a limited liability company unless the creditor meets the requirements of paragraph one of this subdivision.”

These above stated conditions should be listed as exemptions under the definition of “beneficial owner” rather than “exempt company”. As the Proposed Amendment is currently written a limited liability company could not qualify as a reporting company, because it meets one of the 20 criteria listed above, but also not qualify as an exempt company, because it does not meet one of the five conditions immediately preceding this paragraph. In which case, what is it?

Who constitutes a “beneficial owner” if the Proposed Amendment becomes law?

The current NY LLCTA defines “beneficial owner” to “have the same meaning as under the CTA ((31 U.S.C.  § 5336(A)(3)), as amended, and any regulations promulgated thereunder.”

The Proposed Amendment would amend the definition of “beneficial owner” to “mean, with respect to any entity or individual who, directly or indirectly, through any contract, arrangement, understanding, relationship, or otherwise: (1) exercises substantial control over the entity; or (2) owns or controls not less than twenty-five percent of the ownership interests of the entity.”

Since the conditions listed under “exempt company” in the Proposed Amendment are not specifically carved out from the definition of “beneficial owner” in the Proposed Amendment, minors, employees of the limited liability company, or creditors of the limited liability company could qualify as beneficial owners. We hope the forthcoming regulations will clarify what “indirect” ownership means.

What other amendments are included in the Proposed Amendment?

The Proposed Amendment adds that “[t]he department of state is hereby authorized to promulgate rules and regulations to further clarify any definitions outlined in this section”. Hopefully, the NYS DOS will issue clarification on the issues raised above.

Below is a brief summary of the NY LLCTA provisions that go into effect on January 1, 2026.

What constitutes “beneficial ownership disclosure” under the NY LLCTA?

The NY LLCTA requires each reporting company file an initial report or beneficial ownership disclosure to identify each beneficial owner by (1) full legal name; (2) date of birth; (3) current home or business street address, and (4) a unique identifying number from: (i) an unexpired passport; (ii) an unexpired state driver’s license; or (iii) an unexpired identification card or document issued by a state or local government agency or tribal authority for the purpose of identification of that individual.

When must the information be filed with NY DOS under the NY LLCTA?

Domestic limited liability companies in existence before January 1, 2026 and foreign limited liability companies authorized to do business in New York before such date will have to electronically file their beneficial ownership disclosure information or a signed statement of exemption by December 31, 2026.

Domestic limited liability companies formed on or after January 1, 2026 and foreign limited liability companies first qualifying for authority to do business in New York on or after such date will be required to electronically file their beneficial ownership disclosure information or a signed statement of exemption within 30 days of such filing.

Are limited liability companies required to update their beneficial ownership information or exempt status?

Yes, annually. Each reporting company must electronically file an annual statement with the NY DOS confirming or updating its (1) beneficial ownership disclosure information, (2) principal executive office street address, (3) status as an exempt company, if applicable, and (4) such other information as may be designated by the NY DOS. Although the NY LLCTA does not specify, presumably, the NY DOS regulations will clarify that each exempt company will also need to file an annual statement confirming its exempt status or otherwise filing its beneficial owner disclosure after losing its exempt status.

What are the penalties for failing to comply with the NY LLCTA?

The NY LLCTA establishes civil penalties for noncompliance. A reporting company which has failed to file the beneficial ownership disclosure, exemption attestation or annual statement as required for more than 30 days shall be shown as “past due” on the NY DOS records until an updated report is filed. The NY state attorney general may assess a fine of up to $500 per day that such company has been past due. Such “past due” status will be removed from the records of the NY DOS upon (1) the past-due company filing an up-to-date statement as required, (2) paying a $250 fine and (3) the attorney general verifying that any other penalties imposed have been paid.

If the failure to file the beneficial ownership disclosure, exemption attestation or annual statement as required continues for more than two years, the company shall be shown as “delinquent” on the records of NY DOS.  The NY state attorney general may assess a fine of up to $500 per day that such company has been delinquent. Such delinquency status will be removed from the records of the NY DOS upon (1) the delinquent reporting company filing an up-to-date statement as required, (2) paying a $250 fine and (3) the attorney general verifying that any other penalties imposed have been paid.

Additionally, any reporting or exempt company that fails to file its beneficial ownership disclosure or attestation of exemption shall be deemed “suspended”, if such company does not complete such filing within 30 days after receiving a notice from NY DOS of its failure to timely file. Under the NY LLCTA, a limited liability company that’s status is changed to “suspended” by the NY DOS cannot conduct business in New York state until the required information has been filed, at which point the suspension shall be deemed annulled and all corporate powers, rights, privileges, immunities, duties and liabilities shall be restored retroactively. However, the suspension of a limited liability company shall not limit or impair the validity of any contract or act of such company, any right or remedy of any other party under or by virtue of any contract, act or omission of such company, the right of any other party to maintain any action or special proceeding against such company, the right of such company to defend any action or special proceeding, or result in any member, manager or agent of such company becoming liable for the contractual obligations or other liabilities of the limited liability company.

Furthermore, the NY state attorney general may bring an action to dissolve or cancel any limited liability company that is delinquent in completing the required filings or knowingly filed false or fraudulent beneficial ownership information.

What should LLCs do to comply with the NY LLCTA?

As of September 25, 2025, the NY DOS has not created an electronic filing database for the required filings under the NY LLCTA or published any accompanying regulations.

Companies should keep up to date on any developments regarding the Proposed Amendment to the NY LLCTA and check to see if NY DOS has issued regulations for compliance with the NY LLCTA, including the creation of the required electronic filing database. Once the rules have been issued, entities should review the regulations to confirm whether they must file an initial report or are eligible to file for an exemption. Additionally, companies should keep updated records of the required information for each owner and enhance their compliance processes to ensure that the required information is being collected and reported to NY DOS on an annual basis.

Companies should also include language in their operating agreement or similar document that requires owners of the company to regularly provide any information required to comply with the NY LLCTA. Additionally, companies may want to consider indemnification provisions if an owner fails to timely provide the required information or provides false or incomplete information. If such operating agreement contains a confidentiality provision, it should include an exception to permit the company to report the required information to NY DOS.

Hopefully, prior to January 1, 2026, the legislature will amend the NY LLCTA to provide clarifications with respect to the issues identified above or the NY DOS will promulgate rules to provide such clarification.

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For further information or guidance on revising your policies, procedures, and operating agreements, please contact David Paseltiner or Rose Egan. You can follow our blog for more information as it becomes available.

During the COVID-19 pandemic, New York State passed a law requiring employers to provide at least 5 or 14 days (depending on certain circumstances) of job protected, paid COVID-19 sick leave to employees who needed to take leave because they (or their minor dependent) were under a mandatory or precautionary order of quarantine or isolation due to COVID-19. This requirement to provide paid COVID-19 sick leave expires on July 31, 2025.

Although the paid COVID-19 sick leave expires on July 31, 2025, employers may still be required to provide sick leave (whether paid or unpaid) under New York Labor Law  §196-b. New York State Labor Law 196-b mandates that employers provide paid or unpaid sick leave to employees depending on the employer’s size and the previous tax year’s net income. Employers with four or fewer employees must provide at least 40 hours of sick leave: (i) unpaid, if the employer’s net income is less than $1 million, or (ii) paid at the employee’s regular rate, if the employer’s net income is greater than $1 million. Employers with five to 99 employees in a calendar year must provide at least 40 hours of paid sick leave each calendar year. Employers with 100 or more employees must provide at least 56 hours of paid sick leave each year. Employees can use the sick leave immediately upon accrual for purposes such as the employee’s or employee’s family member’s mental or physical illness, injury or health condition, as well as for the employee’s or employee’s family member’s safety to supplement leave for prenatal care, crime victims or victims of domestic violence. Earned sick leave must be tracked by the employer and any unused sick leave must be carried over to the next calendar year. However, an employer does not have to pay out the earned sick leave when employment ends.

This law does not interfere with existing municipal sick leave laws (such as in New York City and Westchester County) and allows for cities to enact local laws or ordinances that conform or exceed the state sick leave law, if the city has a population of one million or more.

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For further information or guidance on revising your policies and procedures in accordance with the above, please contact David Paseltiner or Rose Egan.

After much litigation surrounding the Federal Corporate Transparency Act (“CTA”) and enforcement of the CTA by the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (“FinCEN”), the U.S. Treasury Department announced the suspension of CTA enforcement against U.S. citizens and domestic reporting companies. A proposed interim final rule (“Proposed Rule”) is currently under a notice and comment period that is set to end May 27, 2025. Following the notice and comment period, FinCEN will review the submissions and develop new regulations.

The Proposed Rule exempts all domestic companies from the CTA reporting requirements. Foreign companies are still required to report their beneficial ownership information. However, under the Proposed Rule, foreign companies are exempt from reporting information on beneficial owners that are U.S. citizens. Thus, foreign companies that only have beneficial owners that are U.S. citizens would also be exempt from the reporting requirements.

FinCEN has announced it intends to issue a new final rule in 2025. We will provide further updates on the new rulemaking requirements from FinCEN when available.

These changes to the Federal CTA do not affect any similar state corporate transparency laws. New York’s LLC Transparency Act (the “NY Act”) requires the disclosure of beneficial ownership information to the New York Department of State by limited liability companies formed under the laws of the state of New York and foreign limited liability companies authorized to do business in the state of New York. The NY Act is largely based on the CTA and currently is set to go into effect on January 1, 2026. We will provide further updates on the NY Act when available.

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For further information or guidance on revising your policies, procedures, and corporate governance agreements, please contact David Paseltiner or Rose Egan. You can follow our blog for more information as it becomes available.

As you may know, we have posted numerous updates on the pending litigation surrounding the Federal Corporate Transparency Act (“CTA”) and enforcement of the CTA by the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (“FinCEN”).

On February 18, 2025, the U.S. District Court for the Eastern District of Texas issued an order lifting the nationwide preliminary injunction of the CTA in Samantha Smith et al. v. United States Department of the Treasury et al. (EDTX 6:24-cv-336). As a result, as of February 19, 2025, the CTA reporting requirements and deadlines are reinstated, on a nationwide basis.

On February 19, 2025, FinCEN issued an alert on its website updating the beneficial ownership information (BOI) reporting requirements, as outlined below:

 Initial Report
Reporting Companies existing on or before December 21, 2024  Must file by March 21, 2025
Reporting Companies created or registered in the United States on or after December 22, 2024 and before January 1, 2025  Must file within 90 calendar days after the earlier of when: (a) the Reporting Company had actual notice its creation or registration in the US was effective, or (b) the public had notice through a publicly accessible registry that such Reporting Company had been created or registered to do business in the US.
Reporting Companies created or registered in the United States on or after January 1, 2025 and before February 20, 2025  Must file by March 21, 2025
Reporting Companies created or registered in the United States on or after February 20, 2025Must file within 30 calendar days after the earlier of when: (a) the Reporting Company had actual notice its creation or registration in the US was effective, or (b) the public had notice through a publicly accessible registry that such Reporting Company had been created or registered to do business in the US.

Additionally, a reporting company must file a report of any updates, changes or corrections to its BOI report by the later of (a) March 21, 2025 or (b) 30 calendar days after the date that (x) a change in beneficial ownership occurs or (y) the reporting company becomes aware or has reason to know of an inaccuracy in its report.

FinCEN also announced its intention to revise the BOI reporting rule to reduce the burden for lower-risk entities, such as many U.S. small businesses.

We will provide further updates on these federal cases and any updates from FinCEN when available.

Furthermore, these federal litigation cases do not affect any similar state corporate transparency laws. New York’s LLC Transparency Act (the “NY Act”) requires the disclosure of beneficial ownership information to the New York Department of State by limited liability companies formed under the laws of the state of New York and foreign limited liability companies authorized to do business in the state of New York. The NY Act is largely based on the CTA and currently is set to go into effect on January 1, 2026.

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For further information or guidance on revising your policies, procedures, and corporate governance agreements, please contact David Paseltiner or Rose Egan. You can follow our blog for more information as it becomes available.

As you may know, we have posted numerous updates on the pending litigation surrounding the Federal Corporate Transparency Act (“CTA”) and enforcement of the CTA by the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (“FinCEN”).

On February 5, 2025, the Department of Justice on behalf of the Department of the Treasury filed an appeal of a federal district court’s January 7th decision granting a nationwide preliminary injunction of the CTA in Samantha Smith et al. v. United States Department of the Treasury et al. (EDTX 6:24-cv-336). Additionally, the Department of Justice filed a motion with the federal district court to stay the January 7th decision, while the appeal is pending to the Fifth Circuit.

In its motion for a stay, Defendant cited the recent United States Supreme Court decision to lift another federal district court’s nationwide preliminary injunction in Texas Top Cop Shop, Inc. et al. v. Merrick Garland, Attorney General of the United States, et al. (EDTX 4:24-cv-478). Furthermore, the motion clarified that if the nationwide preliminary injunction is lifted, then FinCEN will extend the BOI report filing deadline for 30 days and “assess whether it is appropriate to modify the CTA’s reporting requirements to alleviate the burden on low-risk entities while prioritizing enforcement to address the most significant risks to U.S. national security.”

As of February 10, 2025, FinCEN has issued an alert on its website stating that it will be accepting voluntary submissions while the nationwide preliminary injunction is in effect.

Ultimately, the constitutionality of the CTA will be decided. We will provide further updates on these cases when available.

These federal litigation cases do not affect any similar state corporate transparency laws. New York’s LLC Transparency Act (the “NY Act”) requires the disclosure of beneficial ownership information to the New York Department of State by limited liability companies formed under the laws of the state of New York and foreign limited liability companies authorized to do business in the state of New York. The NY Act is largely based on the CTA and currently is set to go into effect on January 1, 2026.

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For further information or guidance on revising your policies, procedures, and corporate governance agreements, please contact David Paseltiner or Rose Egan. You can follow our blog for more information as it becomes available.

As you may know, we have posted numerous updates on the pending litigation surrounding the Federal Corporate Transparency Act (“CTA”) and enforcement of the CTA by the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (“FinCEN”).

After considerable back and forth in the last several weeks on whether the CTA Beneficial Owner Information filing deadlines should be stayed pending a federal district court’s decision on the constitutionality of the CTA, the United States Supreme Court has decided to lift the federal district court’s nationwide preliminary injunction in Texas Top Cop Shop, Inc. et al. v. Merrick Garland, Attorney General of the United States, et al. (EDTX 4:24-cv-478). However, a separate division of the Eastern District of Texas granted another nationwide preliminary injunction in Samantha Smith et al. v. United States Department of the Treasury et al. (EDTX 6:24-cv-336).

The confusion continues. Given that the Supreme Court’s decision was issued in Texas Top Cop Shop on January 23rd, after the lower federal court’s January 7th decision in Smith, the Smith court may amend its order to conform with the Supreme Court’s decision in Texas Top Cop Shop.Additionally, with the new administration settling in, there is uncertainly whether the U.S. Attorney General’s Office will pursue defending the CTA any further.

As of January 24, 2025, FinCEN has issued an alert on its website stating that it will be accepting voluntary submissions while the nationwide preliminary injunction is in effect.

Ultimately, the constitutionality of the CTA will be decided. We will provide further updates on these cases when available.

These federal litigation cases do not affect any similar state corporate transparency laws. New York’s LLC Transparency Act (the “NY Act”) requires the disclosure of beneficial ownership information to the New York Department of State by limited liability companies formed under the laws of the state of New York and foreign limited liability companies authorized to do business in the state of New York. The NY Act is largely based on the CTA and currently is set to go into effect on January 1, 2026.

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For further information or guidance on revising your policies, procedures, and corporate governance agreements, please contact David Paseltiner or Rose Egan. You can follow our blog for more information as it becomes available.

As you may know, we posted an update on the pending litigation surrounding the Federal Corporate Transparency Act (“CTA”) and enforcement of the CTA by the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (“FinCEN”). On December 3, 2024, a nationwide preliminary injunction was issued by the Federal District Court for the Eastern District of Texas (Texas Top Cop Shop, Inc. et al. v. Merrick Garland, Attorney General of the United States, et al. (EDTX 4:24-cv-478)). The defendants’ filed an appeal and motion seeking to lift the preliminary injunction.

On December 23, 2024, the United States Court of Appeals for the Fifth Circuit (Case No. 24-40792) issued an Order granting Appellants’ motion for a stay of the Federal District Court’s nationwide preliminary injunction, which lifted the preliminary injunction. However, on December 26, 2024, a different panel of the U.S. Court of Appeals for the Fifth Circuit issued an order vacating the Court’s December 23, 2024 order granting a stay of the preliminary injunction. Accordingly, as of December 26, 2024, the injunction issued by the district court in Texas Top Cop Shop, Inc. v. Garland  is in effect and reporting companies are not currently required to file beneficial ownership information with FinCEN. FinCEN has issued an alert, on its website, stating that it will be accepting voluntary submissions only, while the nationwide preliminary injunction is in effect.

The Fifth Circuit has ordered that the appeal will be expedited to the next available oral argument panel. However, the Fifth Circuit’s decision does not decide on the constitutionality of the CTA, which is still pending before the District Court for the Eastern District of Texas. We will provide further updates on these cases when available.

The federal litigation cases do not affect any similar state corporate transparency laws. New York’s LLC Transparency Act (the “NY Act”) requires the disclosure of beneficial ownership information to the New York Department of State by limited liability companies formed under the laws of the state of New York and foreign limited liability companies authorized to do business in the state of New York. The NY Act is largely based on the CTA and currently is set to go into effect on January 1, 2026.

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For further information or guidance on revising your policies, procedures, and corporate governance agreements, please contact David Paseltiner or Rose Egan. You can follow our blog for more information as it becomes available.

As you may know, we posted an update on the pending litigation surrounding the Federal Corporate Transparency Act (“CTA”) and enforcement of the CTA by the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (“FinCEN”). On December 23, 2024, the United States Court of Appeals for the Fifth Circuit (Case No. 24-40792) issued an Order granting Appellants’ motion for a stay of the Federal District Court’s nationwide preliminary injunction, which means that the preliminary injunction of the CTA has been lifted. As a result, the CTA reporting requirements and deadlines are reinstated, on a nationwide basis. FinCEN has announced updated initial BOI report filing deadlines as discussed in our article.

On December 23, 2024, the United States Court of Appeals for the Fifth Circuit (Case No. 24-40792) issued an Order granting Appellants’ motion for a stay of the Federal District Court’s nationwide preliminary injunction, which means that the preliminary injunction of the CTA has been lifted. As a result, the CTA reporting requirements and deadlines are reinstated, on a nationwide basis. FinCEN has announced updated initial BOI report filing deadlines, on its website, as outlined below:

 Initial Report
Reporting Companies existing before January 1, 2024  Must file by January 13, 2025
Reporting Companies created or registered in the United States on or after September 4, 2024 that had a filing deadline between December 3, 2024 and December 23, 2024  Must file by January 13, 2025
Reporting Companies created or registered in the United States on or after December 3, 2024 and on or before December 23, 2024  Have an additional 21 days from their original filing deadline to file. The original filing deadline is within 90 calendar days after the earlier of when: (a) the Reporting Company had actual notice its creation or registration in the US was effective or (b) the public had notice through a publicly accessible registry that such Reporting Company had been created or registered to do business in the US.
Reporting Companies formed on or after December 24, 2024 and before January 1, 2025DomesticMust file within 90 calendar days after the earlier of when: (a) it has actual notice that its creation is effective, or (b) the public has notice through a publicly accessible registry that the domestic reporting company has been created
ForeignMust file within 90 calendar days after the earlier of when: (a) it has actual notice that its registration in the US is effective, or (b) the public has notice through a publicly accessible registry that the foreign reporting company has been registered to do business
Reporting Companies formed on or after January 1, 2025DomesticMust file within 30 calendar days after the earlier of when: (a) it has actual notice that its creation is effective, or (b) the public has notice through a publicly accessible registry that the domestic reporting company has been created
ForeignMust file within 30 calendar days after the earlier of when: (a) it has actual notice that its registration in the US is effective, or (b) the public has notice through a publicly accessible registry that the foreign reporting company has been registered to do business

Additionally, a reporting company must file a report within 30 calendar days after the date that (x) a change in beneficial ownership occurs or (y) the reporting company becomes aware or has reason to know of an inaccuracy in its report.

The Fifth Circuit has ordered that the appeal will be expedited to the next available oral argument panel. However, the Fifth Circuit’s decision does not decide on the constitutionality of the CTA, which is still before the District Court for the Eastern District of Texas. We will provide further updates on these cases when available.

The federal litigation cases do not affect any similar state corporate transparency laws. New York’s LLC Transparency Act (the “NY Act”) requires the disclosure of beneficial ownership information to the New York Department of State by limited liability companies formed under the laws of the state of New York and foreign limited liability companies authorized to do business in the state of New York. The NY Act is largely based on the CTA and currently is set to go into effect on January 1, 2026.

******************************************

For further information or guidance on revising your policies, procedures, and corporate governance agreements, please contact David Paseltiner or Rose Egan. You can follow our blog for more information as it becomes available.

As you may know, we posted an update on the pending litigation surrounding the Federal Corporate Transparency Act (“CTA”) and enforcement of the CTA by the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (“FinCEN”). On December 3, 2024, a nationwide preliminary injunction was issued by the Federal District Court for the Eastern District of Texas (Texas Top Cop Shop, Inc. et al. v. Merrick Garland, Attorney General of the United States, et al. (EDTX 4:24-cv-478)). However, the defendants’ filed an appeal and motion seeking to lift the preliminary injunction.

On December 23, 2024, the United States Court of Appeals for the Fifth Circuit (Case No. 24-40792) issued an Order granting Appellants’ motion for a stay of the Federal District Court’s nationwide preliminary injunction, which means that the preliminary injunction of the CTA has been lifted. As a result, the CTA reporting requirements and deadlines are reinstated, on a nationwide basis, as outlined below:

 Initial Report
Entities existing before January 1, 2024  Must file by January 1, 2025
New entities formed on or after January 1, 2024 and before January 1, 2025DomesticMust file within 90 calendar days after the earlier of when: (a) it has actual notice that its creation is effective, or (b) the public has notice through a publicly accessible registry that the domestic reporting company has been created
ForeignMust file within 90 calendar days after the earlier of when: (a) it has actual notice that its registration in the US is effective, or (b) the public has notice through a publicly accessible registry that the foreign reporting company has been registered to do business
New entities formed on or after January 1, 2025DomesticMust file within 30 calendar days after the earlier of when: (a) it has actual notice that its creation is effective, or (b) the public has notice through a publicly accessible registry that the domestic reporting company has been created
ForeignMust file within 30 calendar days after the earlier of when: (a) it has actual notice that its registration in the US is effective, or (b) the public has notice through a publicly accessible registry that the foreign reporting company has been registered to do business

Additionally, a reporting company must file a report within 30 calendar days after the date that (x) a change in beneficial ownership occurs or (y) the reporting company becomes aware or has reason to know of an inaccuracy in its report.

The Fifth Circuit has ordered that the appeal will be expedited to the next available oral argument panel. However, the Fifth Circuit’s decision does not decide on the constitutionality of the CTA, which is still before the District Court for the Eastern District of Texas. We will provide further updates on these cases when available.

The federal litigation cases do not affect any similar state corporate transparency laws. New York’s LLC Transparency Act (the “NY Act”) requires the disclosure of beneficial ownership information to the New York Department of State by limited liability companies formed under the laws of the state of New York and foreign limited liability companies authorized to do business in the state of New York. The NY Act is largely based on the CTA and currently is set to go into effect on January 1, 2026.

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For further information or guidance on revising your policies, procedures, and corporate governance agreements, please contact David Paseltiner or Rose Egan. You can follow our blog for more information as it becomes available.