US Asks Supreme Court to Unblock Corporate Transparency Act

[LetMyPeopleVote]

The Department of the Treasury and the DOJ are not giving up on enforcing the Corporate Transparency Act during 2025

Link to tweet

https://news.bloomberglaw.com/litigation/us-asks-supreme-court-to-unblock-corporate-transparency-act

The US Department of Justice asked the US Supreme Court to halt a nationwide injunction against the Corporate Transparency Act, a move that would allow enforcement of the anti-money laundering law during an appeal.

The US said the lower court injunction should be stayed since the high court traditionally applies a strong presumption in favor of allowing challenged acts of Congress to remain pending a final review, according to the application filed Tuesday.

The federal government is challenging a Dec. 3 injunction by a federal judge in Texas, who found that passing the anti-money laundering law overstepped Congress’ constitutional authority under the Commerce Clause. While a Fifth Circuit panel initially ruled in the government’s favor to allow the law’s reporting requirements, a second panel stepped in Dec. 26 to re-block enforcement.

The CTA would require roughly 32.6 million existing business entities to disclose their beneficial owners to the US Treasury Department, a requirement intended to crack down on illegal economic activity. But the district court ruled that the Commerce Clause can’t be leveraged to compel the disclosure of information for law enforcement purposes.

The back-and-forth rulings have added significant uncertainty to the holidays for corporate compliance officials, who started the month facing a Jan. 1 filing deadline that was frozen, then unfrozen, then pushed back a few weeks by Treasury, then re-blocked.

[Bread and Circuses]

1. Sure Texas , a little bit of money laundering here, there and everywhere .Judge Amos Mazzant

Of course Texas judge would think that a money laundering is no problemo!

His name is Amos Mazzant, nominated by Ted Cruz and appointed by Obama in his many attempts to appease the traitors.

Remember his name, he’ll be appointed to a higher court by the Felon.

https://en.wikipedia.org/wiki/Amos_Mazzant

[Igel]

2. I'm looking over the reporting requirements.

My parents set up a trust for their house and savings, any bonds or stocks they had for retirement. All assets were supposed to be included, but my mother balked and kept a lot of stuff out. Let's assume that they'd invested in some small business and owned 25% of it but otherwise let the thing be, little monitoring (they easily could have, all that's required is for the company to be registered--my wife ran a small jewelry thing on EBay for a few years and if they'd chucked money to help her get started, there you go).

My brother and I were beneficiaries of the trust. Our names/info would need to be included and updated on the business's filing. If my parents changed beneficiaries--and they did removing my brother, that business would have been out of compliance at its next filing. "Intention" doesn't matter.

At one point I was the de-facto manager of shipping and a company bookkeeper for a small, 5-person company. I exerted significant control over some of the operations. My info would have been included.

My brother did set up his own computer business, run out of a desk in the master bedroom. Not a community property state, but would his wife have "substantial" influence over him, "substantial" poorly defined? Yup. His wife would need be listed. And since his son was heir on his will, at 18 he'd have to have been included. "Beneficial owner" is defined real broad.

My wife was delaying divorcing me and that Ebay thing my wife had? I'd have been on the hook for providing my information--or screwing her over by withholding it--because even though I arguably had little control over her mini-company, it's a community property state so all of her "beneficial ownership" rights included me.

What info?

Beneficial Owner Information (control persons and persons holding 25% of more equity):
o Name
o Date of Birth
o Residential Address
o Government ID Number (i.e. passport or driver’s license number)
o Issuing Governmental Entity
o Image of Government ID (to be uploaded as pdf or jpg with BOI Report)

That's pretty intrusive. And how many businesses won't want to hire legal counsel to get right down to all the ins and outs of who actually qualifies as a beneficial owner? How would you even compel a person that far out in the network to provide all the information?

At least that's what I get out of a variety of law websites offering advice and services for the reporting and paraphrasing the law.

"MYDB" is what comes to mind for a lot of that. But that's just the all-good "enforcement of the anti-money laundering law", and who's against that?

[Nictuku]

4. Thank you for posting this

That is a lot of info, but it really helps to clarify what this transparency act is about.

[LetMyPeopleVote]

6. Only entities who have to file with the applicable Secretary of State has to file under the Corporate Transparence Act

The CTA only applies to statutory trusts where there is a filing with the secretary of state
https://fincen.gov/boi-faqs#C_3

C. 3. Are certain corporate entities, such as statutory trusts, business trusts, or foundations, reporting companies?

It depends. A domestic entity such as a statutory trust, business trust, or foundation is a reporting company only if it was created by the filing of a document with a secretary of state or similar office. Likewise, a foreign entity is a reporting company only if it filed a document with a secretary of state or a similar office to register to do business in the United States.

State laws vary on whether certain entity types, such as trusts, require the filing of a document with the secretary of state or similar office to be created or registered.

If a trust is created in a U.S. jurisdiction that requires such filing, then it is a reporting company, unless an exemption applies.

Similarly, not all states require foreign entities to register by filing a document with a secretary of state or a similar office to do business in the state.

However, if a foreign entity has to file a document with a secretary of state or a similar office to register to do business in a state, and does so, it is a reporting company, unless an exemption applies.

Entities should also consider if any exemptions to the reporting requirements apply to them. For example, a foundation may not be required to report beneficial ownership information to FinCEN if the foundation qualifies for the tax-exempt entity exemption.

Chapter 1 of FinCEN’s Small Entity Compliance Guide (“Does my company have to report its beneficial owners?”) may assist companies in identifying whether they need to report.

[Issued November 16, 2023]

If this CTA is revived, you may want to see if the trust is covered.

[Nictuku]

3. I won't be holding my breath

I am holding my breath on whether or not Biden is going to actually sign the Social Security Fairness Act.

My beloved ex-husband was a teacher half of his life (and a Limo Driver the other half) and he will benefit from this. It is a nail biter. We are running out of time.

The bill is on his desk, I've read that it might be signed Jan 6th. But a lot can happen on Jan 6th, so that is nerve-wracking. He could pocket-veto it because some (on the right, of course) are saying it will speed up SS insolvency. But all they have to do is raise the cap. Like I said, a nail biter. I hope he signs it, (for Mr. Nictuku's peace of mind).

I thought everyone wanted Transparency... oh, except the Supreme Court. Somehow I feel like they would be against this, as they are against most things that are good for the people, but not corporations. I guess we will see.

[LetMyPeopleVote]

7. President Biden is expected to sign this act on January 6

Link to tweet

[LetMyPeopleVote]

12. This act is now law

Link to tweet

[Nictuku]

13. Great News!!! Thanks for posting

[marybourg]

5. Even the 5 elderly members of the Board of Directors

of our senior housing HOA are subject to this law and its draconian potential penalties. so serious that we hired an outside company at $100 a head to manage our applications and continued compliance..

[LetMyPeopleVote]

8. I have many clients who have been able to file with out help

Neither law firms nor CPA firms are doing these filings and we have referred clients to a couple different companies.

As a lawyer, I have to join in filings for entities formed after December 31, 2023. It only took me 6 minutes to get a FinCen number and for entities that I have formed as the Company Applicant all I have to do is give company my FinCen number to do the filing.

[marybourg]

9. We all filed without help, but want our ongoing positions managed.

Currently, of the 5 members, I am recovering from serious heart and lung issues resulting from a fall and another member is re-habbing from back surgery. We are all in our 70’s and 80’s.

[LetMyPeopleVote]

10. DOJ is asking the Supreme Court to stay the injunction against the Corporate Transparency Act

Link to tweet

[LetMyPeopleVote]

11. Corporate Transparency Act Enforcement ON HOLD AGAIN

Link to tweet

BREAKING: Corporate Transparency Act Enforcement ON HOLD AGAIN
Court hits reverse! Fifth Circuit just flipped its own ruling:
Dec 23: Enforcement ON Dec 26: Enforcement OFF 😵‍💫
What it means: BOI reporting requirements blocked while courts debate. Stay tuned for more whiplash! ↔️
#CTA #CorpTransparencyAct #BusinessLaw 1/2
🗓️ Key Context:
Original deadline: Jan 1, 2025
FinCEN extended to: Jan 13, 2025

Current status: Enforcement blocked
Next: Expedited court review
Follow for updates as this develops! ⚖️