On December 3, 2024 — in a decision welcomed by small business owners across the country — a federal district court in Texas issued an injunction preventing the enforcement and implementation of the Corporate Transparency Act (CTA).
The decision came in the case of Texas Top Cop Shop Inc., et al. v. Garland, et al. Forbes called it a “win for federalism,” noting, “Judge [Amos] Mazzant’s opinion strongly rebuked the CTA for overstepping constitutional boundaries. He noted that corporate regulation has traditionally fallen within the states’ jurisdiction.”
The CTA was enacted in 2021 allegedly to combat tax fraud, money laundering, and other financial crimes. The law requires “Beneficial Information Ownership Reports” to be filed by millions of small businesses — all in the hopes of catching a criminal.
We at the Wisconsin Patriots Toolbox, and our friends at Northeast Wisconsin (NEW) Patriots and Fox Cities Sports magazine, rather wish the order had come a month earlier. Having received notices that our filings were due in early November, we dutifully complied. Daily fines of $500 and criminal penalties of up to two years’ imprisonment were thus avoided.
Lucky for all of us, we’re small organizations. Filing the Beneficial Ownership Information Report required of us took about 10 minutes per organization, not the “up to 11 hours” Vivek Ramaswamy warned about in a recent post on X. And we didn’t pay the “National Filing Service” the $300 it wanted to file the reports on our behalf. How many did, we wonder?
We did, however, provide FinCEN (the Financial Crimes Enforcement Network) with enough information — driver’s license image uploads and home addresses, for example — to make this more than just an annoyance. The federal government’s appetite for collecting information is insatiable, unjustifiable, expensive, and a threat to liberty … and we regret having been a part of it.
Of course, Judge Mazzant’s ruling isn’t the end of it. The Department of Justice has, of course, appealed. Forbes magazine encourages small businesses to stay tuned … and be prepared to file.
So maybe we’re glad to have beaten the holiday rush after all.
The unthinkable intrusion into small business affairs! I along with I am sure millions of other small LLC owners have already submitted the required info, as the fines would have been too big to carry. Sad state we are in… Maybe this will be discontinued, but will all the ownership info the federal government now possesses be destroyed?