A Texas federal court halted the implementation of the Corporate Transparency Act’s beneficial ownership reporting requirements that included America’s farmers, ranchers, and agribusinesses. The court held the CTA as likely unconstitutional, so it issued a preliminary injunction barring the government from enforcing the Act and its reporting requirements against anyone.
Before the ruling, small businesses that met certain criteria would have had to file reports with the Treasury Department by January 1, 2025, or risk fines and criminal penalties.
The preliminary relief will remain in effect until the conclusion of legal proceedings, at which point the court may enter a permanent injunction. In the meantime, the government is expected to appeal the preliminary injunction.
The U.S. Chamber of Commerce says unless and until an appellate court overrules or narrows the injunction, no businesses are obligated to comply with the reporting requirements. Congress enacted the CTA on January 1, 2021.
Farm Bureau is among the groups speaking out in appreciation of the court’s decision to pause the filing requirements. President Zippy Duvall said in a statement that since the passage of the act in 2021, “Questions are swirling about who is required to file and who will have access to the confidential data being collected.”
He continued, saying, “Farm Bureau has long fought against the mandated disclosure of farmers’ private business information to the federal government in a number of different scenarios. For a second time this year a federal court has ruled the CTA oversteps the Constitution on that front. We appreciate the temporary reprieve provided by the injunction and hope Congress can take a cue from the courts in the coming weeks to provide a more permanent resolution to this problematic policy.”
Source: NAFB News Service
