Michael Craig’s Post

Took longer than I expected, but a court has finally thought the CTA law into limbo. Not sure if this will kill the law, but good to know for companies who have not filed over the course of the year. On December 3, 2024, the U.S. District Court for the Eastern District of Texas took a significant step by issuing a nationwide preliminary injunction halting the enforcement of the Corporate Transparency Act (CTA) and its implementing regulations. For those unfamiliar, the CTA mandates that many U.S. and foreign companies doing business in the U.S. report their beneficial ownership details to the Financial Crimes Enforcement Network (FinCEN). Here’s the critical takeaway: the court made it clear that companies formed before January 1, 2024, are not required to meet the January 1, 2025, reporting deadline. While the ruling didn’t explicitly address deadlines for companies formed after January 1, 2024, or for updated reports, the injunction appears to put the entire framework of the CTA—and its deadlines—on pause. In short, compliance obligations under the CTA are currently suspended across the board, pending further legal developments. https://lnkd.in/gC_AGRVR

📢 Breaking News: Nationwide Injunction Suspends Corporate Transparency Act Enforcement On Dec. 3, 2024, the U.S. District Court for the Eastern District of Texas issued a nationwide preliminary injunction, temporarily halting enforcement of the Corporate Transparency Act (CTA) and its Beneficial Ownership Information Reporting Rule. This ruling pauses the requirement for reporting companies to disclose their beneficial ownership information (BOI) to FinCEN. The injunction applies across the U.S., suspending CTA filing obligations until further notice. Stay tuned for updates as the legal landscape evolves! #CorporateTransparency #LegalUpdate #CTA

A Federal District Court held that the Corporate Transparency Act is unconstitutional, stating it “exceeds the Constitution’s limits on Congress’ power." The ban on the CTA's enforcement is limited to the NSBA and its 60,000+ members... Given the narrow nature of this summary judgment, unless the Treasury Department suspends enforcement of CTA for all 30+ million businesses that are obligated to file, CTA BOI reports will need to be filed by all of those tens of millions of businesses except for the less than 65,000 NSBA members to which the decision applies... Many believe that all reporting companies facing CTA deadlines should seriously consider filing, even if the Federal District Court's ruling covers them. Businesses that fail to file in time to meet their CTA deadlines are betting on the NSBA prevailing in the courts. Meanwhile, if the UST prevails, these businesses will potentially face significant civil fines, interest, and penalties, as well as possible criminal penalties, including jail time... https://lnkd.in/eJV-_eHh

🚨 Important Update on the Corporate Transparency Act (CTA) 🚨 On December 3, 2024, a federal district court in Texas issued a nationwide preliminary injunction, temporarily halting the enforcement of the CTA and its Beneficial Ownership Information (BOI) reporting requirements. This means the January 1, 2025, reporting deadline is currently suspended. The court's decision highlights concerns about the CTA's constitutionality, describing it as "quasi-Orwellian" and beyond the scope of Congress's authority under the Commerce Clause and Necessary and Proper Clause. The U.S. Department of Justice has already filed an appeal, so stay tuned for further developments. This injunction provides temporary relief from the reporting requirements for businesses, but it's crucial to stay informed as the legal situation evolves. It further establishes FINCEN's overreach in its authoritarian rules. #CorporateTransparency #LegalUpdate #Compliance #BusinessLaw https://lnkd.in/ghD5cfsk

🚨 Breaking Legal Update: Corporate Transparency Act Enforcement Halted Nationwide 🚨 On December 3, 2024, the U.S. District Court for the Eastern District of Texas issued a nationwide preliminary injunction against the enforcement of the Corporate Transparency Act (CTA). The decision, handed down by Judge Amos Mazzant in the case Texas Top Cop Shop, Inc. et al. v. Garland, et al., declared the law likely unconstitutional. This ruling effectively pauses the CTA’s reporting requirements for businesses across the United States. 💼 What Is the CTA? Enacted in 2021, the CTA mandates that most corporate entities disclose their beneficial ownership information to the U.S. Treasury’s Financial Crimes Enforcement Network (FinCEN) to combat money laundering and financial crimes. The reporting requirements were set to take effect on January 1, 2025. ⚖️ The Court’s Reasoning The court found that the CTA may exceed Congress’s authority and infringe upon states' rights, echoing similar concerns raised earlier this year in National Small Business United v. Yellen in Alabama, where the law was also deemed unconstitutional—but only for the parties involved in that case. 🛑 What Does This Mean for Businesses? For now, companies are not required to comply with the CTA’s reporting requirements until further notice. However, the Department of Justice is expected to appeal the ruling, potentially leading to further legal developments. 📢 Stay Informed This decision underscores the evolving legal landscape surrounding corporate compliance and transparency laws. Businesses should stay updated on this issue, as future court decisions or legislative actions may alter the status quo. #CorporateTransparencyAct #Compliance #LegalUpdate #BeneficialOwnership #CorporateLaw #BusinessTransparency

🚨Update: Alabama's federal court declared the Corporate Transparency Act (CTA) unconstitutional. This has immediate impacts for some, but not all, businesses as of March 1, 2024. 🔍 Highlights: - Government appeals decision. - CTA still in place for entities not part of the lawsuit. - Opens potential for further legal challenges. 🔗 Curious about how this affects you or your business? Learn more via the link below. https://lnkd.in/gQhxvcHg

There are new developments with respect to the Corporate Transparency Act, and Dykema is following the litigation. Read more about the current status of the Act here:

A Federal District Court Judge in the Eastern District of Texas held that the Corporate Transparency Act (“CTA”) is unconstitutional and issued a nationwide preliminary injunction against its enforcement. The CTA is broad legislation that requires any reporting company, whether foreign or domestic, to file a report detailing its beneficial ownership information if it was formed through the filing of documents in any state or U.S. jurisdiction. The law went into effect on January 1, 2024, for reporting companies formed in 2024. Read here for the latest update: https://okt.to/RLWqAK

Have you heard about a January 1st deadline for beneficial ownership reporting? A federal district court in Texas just issued a nationwide injunction suspending enforcement of the Corporate Transparency Act regulations, including the deadline. Learn more about the ruling (and next steps for business owners!) in this post from NALC Senior Staff Attorney Elizabeth Rumley and NALC partner Southern Ag Today. https://lnkd.in/gWbWYx3H #CTA #BOI

A Federal District Court Judge in the Eastern District of Texas held that the Corporate Transparency Act (“CTA”) is unconstitutional and issued a nationwide preliminary injunction against its enforcement. The CTA is broad legislation that requires any reporting company, whether foreign or domestic, to file a report detailing its beneficial ownership information if it was formed through the filing of documents in any state or U.S. jurisdiction. The law went into effect on January 1, 2024, for reporting companies formed in 2024. Read here for the latest update: https://okt.to/Pp1azG