 CLIENT ADVISORY ALERT Nationwide Halt on Corporate Transparency Act Reporting Requirements Issued by Texas Court |
On December 3, 2024, a Texas Federal District Court issued a nationwide preliminary injunction halting enforcement of the Beneficial Ownership Information (BOI) reporting requirements under the Corporate Transparency Act (CTA).
This decision applies nationwide.
For now, condominium, subdivision, and community associations throughout the country do not have to comply with the CTA reporting requirements.
The case is Texas Top Cop Shop, Inc. v. Garland, and the opinion can be reviewed by following this link. The CTA, as originally enacted, applies to most community, subdivision, and condominium associations, as well numerous other entities, by requiring them to disclose their beneficial ownership to the federal government. For more background on the CTA and its implications for associations, see our prior article here.
This may not be the end of the CTA and its BOI reporting requirements. The injunction will remain in place unless it is overturned by a higher court or modified in subsequent legal proceedings. Given the potential significance of this case, an appeal seems likely. If the preliminary injunction is appealed, higher courts will have an opportunity to weigh in on the constitutionality of the CTA’s reporting requirements.
We will continue to monitor this case and how it may affect CTA filing requirements, and we will continue to provide updates as this evolves.
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