On March 1, 2024, a federal district court in Alabama entered a final declaratory judgment, finding the Corporate Transparency Act (CTA) unconstitutional and enjoining the Department of the Treasury and Financial Crimes Enforcement Network (FinCEN) from enforcing the CTA against the plaintiffs. Nat’l Small Business United et. al., v. Janet Yellen, et al., Case No. 5:22-cv-1448 (N.D. Ala. 2024).
The CTA, effective as of January 1, 2024, mandates certain entities (Reporting Companies) to disclose information about their Beneficial Owners to FinCEN. For additional details regarding the CTA and its reporting requirements, please refer to Kerr Russell’s FAQs.
On March 4, 2024, FinCEN released a notice(goes to new website) regarding the scope of the court’s decision and ongoing compliance with the CTA (Notice). In the Notice, FinCEN indicated that it is not currently enforcing the CTA against the plaintiffs in the case, which include Isaac Winkles, Reporting Companies with Winkles as the Beneficial Owner or Company Applicant, the National Small Business Association (NSBA), and NSBA members (as of March 1, 2024). Although not clearly stated in the Notice, the CTA remains in effect for all others.
