On January 1, 2024, the Corporate Transparency Act (CTA) came into effect. The CTA represents a novel regulatory development in the United States that requires a broad class of legal entities (referred to as “reporting companies”) to identify and report beneficial ownership information (BOI) on a confidential basis to a federal, centralized data repository.
On March 1, 2024, a federal judge in the Northern District of Alabama, Northeastern Division, in the case National Small Business United, d/b/a the National Small Business Association, v. Yellen, ruled that the CTA was unconstitutional, at least as it applied to the plaintiffs in that case, which has created questions as to the ongoing validity of the law more broadly. The decision has been appealed.
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