Good news: the Corporate Transparency Act (CTA) is on hold again! In the first instance, the CTA was struck down on December 3, 2024, by the District Court for the Eastern District of Texas, holding that the Act falls outside of Congress’ powers to regulate interstate and foreign commerce. The ruling temporarily stopped the law that would have required business owners to report and regularly update personal information, known as Beneficial Ownership Information (BOI), to the U.S. Treasury Department’s Financial Crimes Enforcement Network (FinCEN) by January 1, 2025. This PRINTING United Alliance article, A Win for Main Street! Corporate Transparency Act Struck Down by Texas Court, describes the first injunction.
However, on December 23rd, the Fifth Circuit Court of Appeals stayed the injunction, reinstating the BOI reporting requirement. FinCEN then immediately extended the reporting deadline to January 13, 2025.
Fortunately, on December 26th, the Fifth Circuit reversed its order and vacated the stay of the injunction, once again halting the CTA and the BOI reporting requirements. As of December 26, 2024, the CTA’s reporting requirements have been put on hold. The injunction will most likely stay in place until the Fifth Circuit Court of Appeals hears oral arguments on March 25, 2025.
CTA Repeal Bill Introduced
On January 15, 2025, Representative Warren Davidson (R-OH) and Senator Tommy Tuberville (R-AL) reintroduced their bicameral CTA repeal bill, dubbed the Repealing Big Brother Overreach Act. This legislation, introduced with 68 original cosponsors, would repeal the CTA and relieve American small business owners from burdensome reporting requirements and potential criminal penalties.
The Alliance joined dozens of its trade association allies in a letter backing the legislation. The letter was spearheaded by our friends at the National Federation of Independent Business (NFIB) and reads in part:
Small businesses are not criminals and do not wish to be treated as such by the federal government. We are not opposed to efforts to fight criminal activity, but these efforts must be targeted and tailored. The CTA is not. It is a sledgehammer that imposes exorbitant fines that could close down millions of small businesses forever and penalties that may criminalize tens of millions of law-abiding small business owners.
On January 10, 2025, our friends at the S-Corporation Association filed an amicus brief with the Supreme Court urging retention of the nationwide injunction against the CTA. The brief was one of more than a dozen filed by the state attorneys general, trade associations, and other stakeholders.
Looking Ahead
Historically, changes in administration bring shifts in legal priorities and strategies. Under the Biden administration, the Department of Justice (DOJ) defended the CTA, emphasizing its alignment with broader policy objectives. However, with the Trump administration's focus on deregulation and the promotion of corporate interests, DOJ’s stance may completely change. During his last term, President Trump vetoed the bill that contained the CTA; it passed only when Congress overrode his veto.
Once again, the Alliance welcomes the relief provided by the most recent injunction, and we look forward to achieving a more permanent resolution to this problematic policy. The Government Affairs team will continue to monitor the case and provide updates as they become available.
In this article, Stephanie Buka, Government Affairs Coordinator, PRINTING United Alliance, reports on the most recent nationwide injunction of the Corporate Transparency Act. More information can be found at Business Excellence-Legislation or reach out to Steph should you have additional questions specific to how these issues may affect your business: sbuka@printing.org.
To become a member of the Alliance and learn more about how our subject matter experts can assist your company with services and resources such as those mentioned in this article, please contact the Alliance membership team: 888-385-3588 / membership@printing.org.