A federal district court in Texas issued a nationwide preliminary injunction against enforcing the beneficial ownership reporting requirements mandated by the Corporate Transparency Act (CTA). (Texas Top Cop Shop v. Garland (December 3, 2024) U.S. Dist. Ct., Eastern Dist. of Texas, Case No. 4:24-CV-478)
The court ruled that Congress exceeded its authority in enacting the CTA, resulting in an unconstitutional infringement on states’ rights to regulate businesses. The court granted a nationwide injunction prohibiting FinCEN from enforcing the January 1, 2025, reporting deadline for all reporting companies.
The opinion was issued on December 3, 2024, and will likely be appealed. However, for now, businesses do not have to file beneficial ownership information reports with FinCEN.
We will continue to update you as news develops on this issue.
The opinion is available at:
www.caltax.com/files/2024/ttcsvgarland.pdf
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