The Corporate Transparency Act is scuttled - again
In the latest twist in the ongoing saga of the Corporate Transparency Act, an appeals court has overturned a previous ruling that would have required millions of U.S. businesses to reveal its "beneficial owners" by a Jan. 13 deadline. Now, companies do not need to file reports with FinCEN.
To explain its ruling, the court shared: "In order to preserve the constitutional status quo while the merits panel considers the parties’ weighty substantive arguments, that part of the motions-panel order granting the Government’s motion to stay the district court’s preliminary injunction enjoining enforcement of the CTA and the Reporting Rule is VACATED.”
The NLBMDA, which has adamantly opposed the legislation, wrote in an email:
"If the government elects not to appeal this new order to the U.S. Supreme Court, at a minimum, the temporary injunction will now remain in place through the end of March 2025."
NLBMDA President Jonathan Paine added: “In just one week, small businesses have been informed of three separate deadlines to file with FinCEN. Vacating the 5th Circuit December 23rd order was a necessary step to help provide stability and clarity for the millions of businesses yet to file.”
Despite the latest turn, the CTA may still come into effect -- eventually. As the New York Times writes:
"Litigation over the Corporate Transparency Act is now working its way through four of the federal appeals courts. The injunction by Judge Mazzant was the first to pause the enforcement of the law across the country.
'I think this case is almost certainly going to the Supreme Court, either now or in the future,' said Caleb Kruckenberg of the Center for Individual Rights, one of the lawyers representing the plaintiffs.
FinCEN has estimated that 32.6 million companies would need to register under the law; Mr. Kruckenberg said the number of individuals affected would be at least three times that number."
