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"...the CTA is not only a bureaucratic overreach, but a Constitutional infringement.” FOR IMMEDIATE RELEASE Monday, March 4, 2024 Contact: Molly Day 202-552-2904 | mday@nsba.biz Judge Rules in Favor of NSBA in Lawsuit over Corporate Transparency Act HUNTSVILLE, AL – NSBA applauds the ruling by the U.S. District Court of the Northern District of Alabama to grant summary judgment in NSBA’s challenge of the constitutionality of the Corporate Transparency Act (CTA). The ruling by Judge Liles Burke to strike down the CTA is a victory for law-abiding small-business owners everywhere who would have been forced to disclose their sensitive personal information to a government database. “The CTA has from the very beginning been poor policy that unfairly targets America’s small businesses,” said Todd McCracken, President and CEO of NSBA. “This ruling justifies the concerns of millions of American businesses about how the CTA is not only a bureaucratic overreach, but a Constitutional infringement.” The challenge to the CTA began in 2022 when the NSBA and Huntsville business owner Isaac Winkles first brought their case before the District Court. While the case was being considered in court, the U.S. Treasury Department’s implementation of the CTA has fallen short of expectations - millions of small-business owners still do not know about the requirements of the CTA The database is ripe for data security issues and confusion which could saddle small-business owners with hefty penalties or even jail time. “As the court noted, the ultimate goals of the CTA, countering money laundering and terrorism financing are laudable,” said John Neiman, counsel for the NSBA and Mr. Winkles. “But as the court also noted, the Constitution sets limits on what Congress can do to achieve even the most laudable of goals, and Congress violated those limits here. Congress can find a way to achieve these goals without exceeding the limits on its powers under the Constitution.” “The judge’s decision is an opportunity for Congress to go back to the drawing board and find a solution that will truly protect Americans from bad actors,” said McCracken. “The CTA simply will not accomplish the goal of stemming money-laundering – what it does is overstep the bounds of privacy, the law, and common sense at the expense of America’s small businesses.” Please click here to read the ruling. Celebrating more than 85 years in operation, NSBA is a staunchly nonpartisan organization advocating on behalf of America’s entrepreneurs. NSBA's 65,000 members represent every state and every industry in the U.S. Please visit www.nsba.biz or follow us at @NSBAAdvocate. ###

A clear victory for law-abiding small-business owners across the U.S. Late Friday, March 1, Judge Liles Burke of the U.S. District Court of the Northern District of Alabama ruled in favor of NSBA’s lawsuit over the constitutionality of the Corporate Transparency Act (CTA). Please click here to read the ruling. NSBA has spent years fighting against the CTA and applauds the ruling which is a clear victory for law-abiding small-business owners across the U.S. who would have been forced to disclose their sensitive personal information to a government database. As the sole small-business organization behind the lawsuit, this ruling is a testament to NSBA’s commitment to America’s small-business owners. “The CTA has from the very beginning been poor policy that unfairly targets America’s small businesses,” said Todd McCraken, President and CEO of NSBA. “This ruling justifies the concerns of millions of American businesses about how the CTA is not only a bureaucratic overreach, but a Constitutional infringement.” NSBA and its member, Huntsville business owner Isaac Winkles, first brought the case before the District Court. While the case was being considered in court, the U.S. Treasury Department’s and the Financial Crimes Enforcement Network’s implementation of the CTA has fallen short of expectations. Millions of small-business owners still do not know about the requirements of the CTA or the beneficial ownership information (BOI) database. The database, which began collecting BOI information earlier this year, is ripe for data security issues and confusion, confusion that could land law-abiding small business owners with hefty penalties or even jail time. “As the court noted, the ultimate goals of the CTA, countering money laundering and terrorism financing are laudable,” said John Neiman, counsel for the NSBA and Mr. Winkles. “But as the court also noted, the Constitution sets limits on what Congress can do to achieve even if the most laudable of goals, and Congress violated those limits here. Congress can find a way to achieve these goals without exceeding the limits on its powers under the Constitution and without violating the constitutional rights of ordinary law-abiding American citizens.” “The judge’s decision is an opportunity for Congress to go back to the drawing board and find a solution that not only protects Americans from bad actors here but overseas,” said McCraken. “The CTA simply will not accomplish the goal of stemming money-laundering – what it does is overstep the bounds of privacy, the law, and common sense at the expense of America’s small businesses.” Please click here for more details on NSBA’s efforts on the CTA. #CTA:NotTheWay

Join NSBA's Vets' Net for a webinar on Wednesday, March 13 at 1:00 p.m. EDT. The NSBA Veterans’ Network will be hosting its next webinar, “Public and Private Contracts 101,” on Wednesday, March 13 at 1:00 p.m. EDT. There, the Service to Success team will explore best practices for networking with buyers, receiving useful feedback on proposals, and leveraging free resources to successfully win bids in the public and private sectors. Space is limited, so don’t delay: click here to reserve your spot on the webinar! Have a question you’d like to see answer during the webinar? Please email NSBA’s Ian Elsenbach at ielsenbach@nsba.biz for consideration.

Commitments to common sense tax policy must prevail in Congress to support small business. On Wednesday, after an evening huddle of Senate Finance Committee Republicans, Ranking Member Mike Crapo (R-Id.) indicated that a majority of the Senate Republican Conference was not currently supportive of the tax deal, and does not want to move forward without that majority, despite support from the Democratic Caucus and overwhelming bipartisan House support. Sen. Crapo himself had previously outlined objections he still had to the tax deal, including provisions relating to the Child Tax Credit (CTC).  Beyond his own objections, Sen. Crapo also shared that other senators had changes they would like to make to the bill, and that making significant tax changes during the IRS filing season was worrisome. This poses a significant hurdle for final passage of any tax deal, especially one which includes key NSBA-led provisions, like the Section 174 R&D expensing fix. RELATED | BRIEF | Reinstate the Annual R&D Deduction If the Senate holds a markup of the House-passed bill, it becomes vastly more difficult for the bill to become law, both because the CTC/R&D compromise underpinning the bill may be in danger of unraveling, and because the House is unlikely to reconsider the bill. If the Senate does reopen consideration, the margin for passage will be much slimmer. Sen. Crapo has said he is, “…working on trying to identify a pathway to see if we can get a majority of our caucus supportive,” but, given his stance on the bill, it is likely that pathway would involve significant changes. NSBA is closely monitoring the progress of the tax deal, and will continue to provide updates as they are received. To continue driving our efforts, make your voice heard by filling out our Action Alert for your Senators, to  highlight just how critical this bill is to small-business owners across the country.

Even with a shutdown looming, Congress prioritized small-business and passed a number of legislative items to the Senate. During Wednesday votes, the U.S. House of Representatives favorably passed a slate of small-business bills, including a number of Veteran-related and opportunity expansion legislative items. H.R. 3511, the Service-Disabled Veteran Opportunities in Small Business Act – sponsored by Reps. LaLota (N.Y.-01), McGarvey (Ky.-03), Lee (Nev.-03), Thanedar (Mich.-13), and Lawler (N.Y.-17). Federal agencies have a goal of spending five percent of all contracting dollars with small businesses owned by service-disabled veterans. This bill requires the Small Business Administration to help failing agencies improve their inclusion of service-disabled veteran owned small businesses. H.R. 4669, the DOE and SBA Research Act – sponsored by Reps. LaLota (N.Y.-01) and Thanedar (Mich.-13). This bill requires the Department of Energy and the Small Business Administration to enter into an agreement to collaborate on research and development activities. H.R. 5265, the Small Business Administration Rural Performance Report Act – sponsored by Reps. Alford (Mo.-04), Luetkemeyer (Mo.-03), Ellzey (Texas-06), Bean (Fla.-04), Stauber (Minn.-08), and Pappas (N.H.-01). This bill requires the Small Business Administration to report on its efforts – specifically within the Office of Rural Affairs – to promote businesses and agricultural economies in rural areas. H.R. 6591, the Encouraging Success Act – sponsored by Reps. Ellzey (Texas-06), Moran (Texas-01), and Thanedar (Mich.-13). This bill requires the Small Business Administration to reassess the 8(a) program threshold cap every four years to ensure that it is in line with market realities. H.R. 7105, the WOSB Certification and Opportunity Expansion Act– sponsored by Reps. Velazquez (N.Y.-07) and LaLota (N.Y.-01). This bill requires that only women-owned small businesses that have been certified by a federal agency, state government, or national certifying entity approved by the Small Business Administration are included when calculating whether a federal agency has met its contracting goals with respect to such businesses during a fiscal year. RELATED | NSBA Support Small-Business Veterans Several other small-business bills previously passed out of the House Small Business Committee were up for a full vote yesterday, but, with the need to address a spending plan to prevent a government shutdown, several items’ consideration was postponed: H.R. 5426 – To require the Administrator of the Small Business Administration to provide a link to resources for submitting reports on suspected fraud relating to certain COVID-19 loans H.R. 7128 – The WOSB Integrity Act of 2024 H.R. 7102 – Native American Entrepreneurial Opportunity Act RELATED | House Small-Business Chair Pens Letter to Pres. on NSBA Issue Priority Follow NSBA as we continue to follow progress on small-business legislation, including the passed items as they move to the Senate for further consideration, and read more about NSBA’s Issue Priorities here.

Shutdowns harm small business. On Thursday, the House passed a temporary funding bill to avert a Saturday partial US government shutdown, sending the bill to the Senate, where it passed 77-13. Congress’ latest stopgap measure will head to President Joe Biden’s desk. The House vote was 320 to 99, with 97 Republicans voting against the stopgap. The bill would extend funds for some departments through March 8 and others through March 22 as lawmakers work out differences on delayed full-year spending packages for the fiscal year that began Oct. 1. House Republican leaders agreed to the fourth interim funding measure of the fiscal year after reaching a deal to fund parts of the government through Sept. 30. RELATED | NEWS | Shutdowns Harm Small Business For how shutdowns harm small business, NSBA commends Congress for prioritizing a solution to prevent a lapse in funding, and we will continue to monitor progress of a longer-term spending plan.

The Consumer Financial Protection Bureau must complete the required analysis of its impact on small businesses. Last week, NSBA President and CEO Todd McCracken sent a letter to the Consumer Financial Protection Bureau (CFPB) regarding its pending final rule on credit card late fees. For nearly 30 years, a law has been in place to ensure that federal regulators understand the potential benefits and harm to small businesses that are easily overlooked in the rulemaking process. Furthermore, per the Small Business Jobs Act, agencies are compelled to consider comments submitted by the U.S. Small Business Administration Office of Advocacy. RELATED | NSBA Letter: Support CCCA Urging the CFPB to fully consider the impact on small businesses ahead of announcement of its final rule, NSBA is optimistic the Bureau will engage with our community on what the regulation might mean for small-business owners’ bottom lines. Read the full letter here. Learn more about NSBA’s Priority Issues here, and follow us as we continue correspondence with agencies, Congress, and leaders and regulators of the small-business community.

Despite the small-business community’s great need for support, the SBA Chief Counsel role in the Office of Advocacy remains vacant. Ahead of the President’s Day holiday and Congress’ scheduled spring recess, House Small Business Committee Chair Roger Williams (R-Texas) wrote a letter to President Biden regarding the current vacancy of the Chief Counsel at the Small Business Administration (SBA) Office of Advocacy - one of NSBA’s Priority Issues for 2024. As regulatory requirements continue to grow and affect the bottom line for small-business owners, a fully staffed SBA is more important than ever for its potential to serve the small-business community. For its specific purpose to serve as watchdog against burdensome regulations, the SBA’s Office of Advocacy should be filled by someone who “understands that small businesses need all the help they can get,” Chairman Williams wrote in his letter. NSBA joins Chairman Williams in his call for President Biden to nominate a qualified candidate to fill this crucial vacancy in the Office of Advocacy. Read our official Issue Brief on this important matter, check out our complete collections of Issue Briefs selected at the beginning of a new session of Congress biennially, and follow NSBA as we continue to track the status of this vacancy in Washington.

Compromise will be key to ensure common sense tax provisions for small business this year. The bipartisan tax deal faces significant hurdles in the Senate, as a number of Senate Finance Committee Republicans have publicly called for hearings and expressed skepticism in the bill’s current form. RELATED | PRESS | NSBA Applauds House for Bipartisan Passage of Tax Relief Bill The Finance Committee holdouts are concerned, firstly, that the bill was written behind closed doors and without their input, and secondly some appear concerned that any tax deal would be seen to be handing a legislative victory to President Biden in a fiercely competitive election year. The overriding concern here is that while the bill passed out of the House overwhelmingly in its current form, any changes made by the Senate are likely to be a “poison pill,” dooming the whole deal, as the House would have to agree to the changes - which it is almost certainly unwilling to do. RELATED | ACTION ALERT | Urge Congress to Pass Tax Bill Moreover, as the Senate currently wrangles with international aid and border negotiations, and with the bifurcated March 1st & 8th funding deadlines approaching, the momentum behind the bill may stall. Follow NSBA as we continue tracking this tax legislation on Capitol Hill.

Much-needed tax relief for small-business. FOR IMMEDIATE RELEASE Feb. 1, 2024 CONTACT | Molly Day 202-552-2904, mday@nsba.biz NSBA Applauds House for Bipartisan Passage of Tax Relief Bill Washington, D.C. – NSBA applauds the House for passing on a broadly bipartisan manner (357-70) the Tax Relief for American Families and Workers Act. This major piece of tax legislation includes several key priorities which NSBA has fought for, including allowing Section 174 expenses to be retroactively deductible beginning with tax year 2022 rather than amortized over a five-year span. “I applaud every Member of Congress who voted for this bill—it is a major win for America’s small businesses,” stated NSBA President and CEO Todd McCracken. “I urge the Senate to follow this example of strong, bipartisan leadership and move quickly on passing this bill.” Among the major wins in this bill, several of which NSBA has been instrumental in highlighting and prioritizing: a retroactive reinstatement of non-amortized research and development deductions under Section 174 for the 2022 and 2023 tax years, extended through 2025; and an increased limit on depreciable asset deductions by $290,000 under Section 179. “NSBA has fought hard in Congress for these provisions, and this bipartisan bill will give small businesses the opportunity to increase jobs, safely participate in the Small Business Innovation Research program, and afford the investment needed to succeed,” stated McCracken. Celebrating more than 85 years in operation, NSBA is a member-driven nonpartisan organization advocating on behalf of America’s entrepreneurs. NSBA's 65,000 members represent every state and every industry in the U.S., and we are proud to be the nation’s first small-business advocacy organization. Please visit www.nsba.biz and follow us at @NSBAAdvocate. ###

Think the CTA doesn't affect you? Think again. Last week, NSBA President and CEO Todd McCracken and a team of experts hosted a fireside chat on the Corporate Transparency Act (CTA) and how this cumbersome law is already costing small-business owners. According to our member poll taken during the webinar, more than 80 percent of small-business owners have yet to file the new paperwork required under the CTA. Think the CTA doesn't affect you. Think, and watch our fireside chat recording, again:

The bill contains small-business tax provisions supported by NSBA. UPDATE | After passage in the House, bipartisan tax deal still faces significant hurdles in the Senate, with a number of Senate Finance Committee Republicans publicly calling for hearings and expressing skepticism in the bill’s current form. RELATED | NEWS | Tax Deal Faces High Hurdles in Senate This week, Congress is set to vote on the new, bipartisan, bicameral Tax Relief for American Families and Workers Act of 2024. Negotiated by Senator Ron Wyden (D-Ore.) and Rep. Jason Smith (R-Mo.), the massive, multibillion-dollar bill is expected to fulfill multiple NSBA priorities we have been fighting for. Thanks to our advocacy, the bill retroactively reinstates non-amortized research and development deductions under Section 174 for the 2022 and 2023 tax years and extends them through 2025. Additionally, it raises the limit on depreciable asset deductions by $290,000 under Section 179. NSBA has fought hard in Congress for these provisions. Additionally, it will give small businesses the opportunity to increase jobs, safely participate in the Small Business Innovation Research program, and afford the investment needed to succeed. Given NSBA’s work informing these provisions, we’re asking for your help getting these amended sections over the finish line.  Please take a moment to complete our Action Alert to contact your Members of Congress directly to urge their support for passage of the tax bill. Follow NSBA as we continue tracking this important legislation.