Corporate Transparency Act put on hold

Dec 4, 2024

FOR IMMEDIATE RELEASE
Contact: Lynne Lance, executive director, lynne@nna.org

The Corporate Transparency Act (CTA) has been put on hold in a far-reaching order that prohibits the federal government from enforcing it anywhere in the country.

In its decision in the case (Texas Top Cop Shop, Inc., et al. v. Garland, et al., Case No. 4:24-cv-478 [E.D. Tex.]) the court found that the law is likely unconstitutional. Among its requirements was an obligation for 32.5 million companies including small businesses to submit sensitive information regarding “beneficial owners” to the United States Department of Treasury’s Financial Crimes Enforcement Network (FinCEN) by January 1, 2025, or face a $500 per day penalty for failure to report.

As a result of the ruling, no business will be required to file Beneficial Owner Information. However, there will likely be further litigation, so the decision could be overturned at a higher level. NNA will be on the alert for any developments that might restore the reporting requirement.