Federal Judge Issues Preliminary Injunction—But FinCEN Ends BOI Reporting for U.S. Companies Altogether
- Alex Khalil
- Mar 24
- 3 min read
Understanding the Shift: From Texas Top Cop Shop to the Treasury’s Rule-making
What began as a legal battle in Texas Top Cop Shop, Inc. v. Garland and National Small Business United v. Yellen has now been overtaken by a sweeping policy shift. On March 21, 2025, the Financial Crimes Enforcement Network (FinCEN) issued an interim final rule eliminating Beneficial Ownership Information (BOI) reporting requirements for all U.S.-created entities and U.S. persons.
This rule effectively supersedes ongoing litigation by removing domestic reporting obligations under the Corporate Transparency Act (CTA). According to FinCEN, only foreign entities registered to do business in the U.S. are now required to file BOI reports—a massive change from the previous nationwide requirements set to take effect in January 2025.
Key Takeaways from the March 21, 2025 Interim Final Rule
Domestic Entities Exempt: All companies formed under U.S. law—formerly considered "domestic reporting companies"—are no longer subject to BOI reporting obligations.
U.S. Beneficial Owners Exempt: U.S. persons, even if they are beneficial owners of foreign reporting companies, are not required to report.
"Reporting Company" Redefined: The term now applies only to foreign entities that have registered to do business in any U.S. state or tribal jurisdiction via a filing.
Revised Deadlines for Foreign Companies: Registered before March 21, 2025: Must file BOI reports within 30 days of the interim rule’s publication.
Registered on or after March 21, 2025: Have 30 days from effective registration to file.
Background and Legal Battles Leading Up to the Shift
Legal challenges to the CTA—including Texas Top Cop Shop, Inc. v. Garland and National Small Business United v. Yellen—argued that Congress exceeded its constitutional authority by requiring private businesses to disclose ownership data. While courts showed some support for those arguments, no appellate ruling had fully and finally invalidated the CTA nationwide.
But FinCEN’s March 2025 rule changes the conversation entirely. Rather than waiting for the courts to sort through complex constitutional issues, the Department of the Treasury has elected to retreat from enforcing BOI requirements on U.S. entities altogether.
This effectively resolves many of the constitutional concerns raised by the plaintiffs and relieves the compliance burdens for millions of small businesses.
What Happens Next?
FinCEN’s rule is not yet final—it is an interim final rule, open for public comment and expected to be finalized later in 2025. However, unless reversed or substantially amended, this rule:
Eliminates BOI reporting obligations for all U.S. companies.
Reduces enforcement efforts and penalties for U.S. persons and businesses.
Streamlines focus on international compliance through foreign entity disclosures.
FinCEN has stated it will not require any U.S.-created entities to file BOI reports or any U.S. persons to be reported as beneficial owners going forward.
What Should Businesses Do Now?
If your business is a U.S.-created entity, you are no longer required to file a BOI report with FinCEN under the current rule. You may disregard prior reporting deadlines—including the January 1, 2025 compliance date—unless you are a foreign entity registered to do business in the U.S.
However, if you operate a foreign company that is registered to do business in the U.S., you still have filing obligations and must comply with FinCEN's new 30-day deadlines.
To ensure full compliance and avoid penalties:
Review your business’s entity status.
Consult legal counsel to determine whether you fall under the new definition of “reporting company.”
Submit comments to FinCEN if you have feedback on the interim rule.
Conclusion
After over a year of uncertainty, legal wrangling, and administrative back-and-forth, FinCEN’s latest rule eliminates BOI reporting obligations for the vast majority of U.S. businesses and individuals. While litigation prompted the conversation, federal rule-making brought the change.
Khalil Law Corporation continues to monitor regulatory updates and legal challenges related to the CTA. If you have questions about your business’s reporting status or obligations under the new rule, our team is ready to guide you through the changes.
Contact Khalil Law Corporation today for personalized legal advice on how the CTA changes affect your business.
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