UPDATE: Corporate Transparency Act Compliance Back on Hold

December 26, 2024

The Corporate Transparency Act (CTA) is once again on hold. On December 26, 2024, a Fifth Circuit panel reinstated a nationwide injunction blocking enforcement of the CTA, just days after another panel lifted it. This ongoing legal back-and-forth has created significant uncertainty for compliance efforts nationwide.

To recap:

The CTA, enacted as an anti-money laundering measure, requires U.S. entities that existed before 2024 to disclose their beneficial owners - individuals who own or control the business - by January 1, 2025.
On December 3, a district court issued a nationwide injunction halting enforcement of the law following a legal challenge.
On December 23, a Fifth Circuit motions panel lifted that injunction, stating the government is likely to succeed in defending the law's constitutionality.
On December 26, another Fifth Circuit panel reinstated the injunction to "preserve the constitutional status quo" while the merits of the case are considered.

For AMG clients, this means compliance with the CTA is not currently required. If you are unsure about how to proceed, each community should consult with their legal counsel to determine the best course of action.

AMG encourages clients to wait until compliance is unequivocally required. We offer this recommendation for two key reasons:

Avoiding Unnecessary Costs: Premature action could result in expenses that may not ultimately be needed.
Minimizing Effort for Volunteer Members: Preparing and submitting the required information is a time-consuming task. Until compliance is mandatory, we believe communities should focus their resources elsewhere and avoid unnecessary burdens on their volunteer members.

For further information, you can refer to the following resources:

AMG does not provide legal advice. We strongly recommend that clients consult with their attorney before making important legal decisions regarding the CTA or any other matter. We remain committed to monitoring developments and keeping you informed. If you have any questions on this issue, please feel free to reach out to your Community Manager.

Warm regards,