Efforts to prevent the Corporate Transparency Act (CTA) from going into effect have ramped up in recent weeks.
Yesterday, NSBA sent a letter to the House Committee on Financial Services Chair Patrick McHenry (R-N.C.) urging a delay and ultimately repeal of the Corporate Transparency Act (CTA) and called upon all lawmakers to support the Protecting Small Business Information Act of 2023 (H.R.4035).
Additionally, the lawsuit NSBA has filed against the Department of Treasury and Financial Crimes Enforcement Network (FinCEN) is moving forward with the Judge in the case setting October 30 as the date for oral arguments.
The CTA was signed into law Dec. 2020 and is set to go into effect January 2024 for all new business formations. This law will require ONLY businesses with fewer than 20 employees to disclose owners’ information to the Department of Treasury’s Financial Crimes Enforcement Network (FinCEN).
Contrary to its stated intent, the CTA has become an administrative distraction that will force millions of hours and upwards of $5.7 billion to be spent on lawyers and annual reporting. Furthermore, this paperwork burden is redundant - banks are already collecting the information FinCEN is seeking through the Customer Due Diligence (CDD).
Stay tuned to NSBA for updates on the CTA.