Courts Grapple With The Corporate Transparency Act

January 16, 2025  |  New York Law Journal

In January 2021, Congress passed the Corporate Transparency Act (CTA) requiring business entities, including partnerships and LLCs, to disclose information regarding their beneficial owners to the Financial Crimes Enforcement Network of the U.S. Treasury Department.  Since becoming law, the CTA’s constitutionality has been challenged in several cases brought across the country.  District courts have split over the statute and on December 5, 2024, Judge Amos L. Mazzant, III of the Eastern District of Texas issued a nationwide preliminary injunction pausing the impending reporting requirements. After initially blocking Judge Mazzant’s injunction, the United States Court of Appeals for the Fifth Circuit reinstated it pending oral argument in March. Beyond review by four of the Circuit Courts of Appeals, the CTA’s fate will be decided by the incoming Trump administration, which seems poised to pursue a business-friendly agenda, and Congressional Republicans, some of whom have historically shown antipathy towards the statute. In his latest article for the NYLJ, Courts Grapple With The Corporate Transparency Act, Morvillo Abramowitz Grand Iason & Anello PC partner Jeremy H. Temkin analyzes the CTA’s background and reporting requirements, reviews challenges to its constitutionality, and notes the political dynamics that may determine the reporting obligation’s future.

Courts Grapple With The Corporate Transparency Act (pdf | 151.76 KB)