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    11 Mar
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    Corporate Transparency Act , Uncategorized ,

    Ding Dong the CTA is Dead … Treasury Department Announces Suspension of Enforcement of Corporate Transparency Act Against U.S. Citizens and Domestic Reporting Companies

    The judicial whiplash has come to an end and associations no longer need to worry about complying with the Corporate Transparency Act. On March 2, 2025, the U.S. Treasury Department announced significant changes to the enforcement of the Corporate Transparency Act’s (CTA) beneficial ownership information (BOI) reporting requirements. In a major policy shift, the Treasury Department confirmed that it will not enforce any penalties or fines related to the BOI reporting rule under the existing deadlines. Furthermore, once forthcoming rule changes take effect, penalties and fines will not be enforced against U.S. citizens, domestic reporting companies, their beneficial owners, or entities such as homeowners associations (HOAs) that were previously subject to these requirements.

    In addition, the Treasury Department will narrow the scope of the CTA to apply only to foreign reporting companies. This move is intended to support American taxpayers and small businesses, including HOAs, while ensuring the rule remains aligned with the public interest.

    This means that HOAs will not need to complete and submit the BOI reporting statement. Additional details on the proposed rule-making and next steps will be released in the coming weeks.

    Have questions? Contact your favorite HGCT attorney to further discuss.

    10 Mar
    0 Comments
    Corporate Transparency Act , Meetings ,

    February 2025 Updates on the Corporate Transparency Act (CTA) and Beneficial Ownership Information (BOI) Reporting

    Latest Court Decision on CTA Enforcement

    The judicial whiplash continues! On February 17, the United States District Court for the Eastern District of Texas lifted a nationwide injunction that had halted the enforcement of the Corporate Transparency Act (CTA).  As a result, the reporting requirements under the CTA are now reinstated for applicable community associations.

    Extended Deadline for BOI Reporting

    On February 19, the Financial Crimes Enforcement Network (FinCEN) announced that the deadline for Beneficial Ownership Information (BOI) reporting has been extended by 30 days from February 19, 2025.  The new deadline for most companies, including homeowner associations, to file their BOI reports is now March 21, 2025.  FinCEN will provide further updates if additional time is needed.

    Legislative Efforts to Delay the CTA

    Congress is considering legislative initiatives to delay the CTA. House of Representatives (H.R.) Bill 736, introduced by Representative Zachary Nunn, and Senate Bill 505, introduced by Senator Tim Scott, aim to push the implementation date for pre-existing entities to January 1, 2026. H.R. 736 has already passed the House and is now being considered by the Senate.

    Stay Informed

    This issue is ongoing and fluid, and association boards should stay updated on the latest developments. Contact your favorite HGCT attorney to further discuss.

     

    HGCT Attorneys in the Wild

    In case you missed it…

    At the 2025 CACM NorCal Law Seminar and Expo, HGCT Attorneys Zer Iyer presented: Funding Projects and Managing Reserves; and Ellen R. Schuster presented: Dealing with Bullies.

    At the CAI CCAL Law Seminar in San Antonio, HGCT attorneys Amy K. Tinetti presented: From Capitol to Community: Tracking State Legislative Trends Across the Country; and Ellen R. Schuster presented: 50 Shades of Gray: Identifying and Navigating Ethical Issues in Community Associations (ETHICS).

     

     

    To learn more about the topics presented at these law seminars, please contact your favorite HGCT attorney.

     

     

     

    05 Dec
    0 Comments
    Corporate Transparency Act ,

    Nationwide Preliminary Injunction Halts Enforcement of Corporate Transparency Act

    On December 3, 2024, a Texas federal court issued a nationwide preliminary injunction blocking the enforcement of the Corporate Transparency Act (CTA) and its implementing regulations.

     

    Court’s Decision

    In Texas Top Cop Shop, Inc., et al. v. Garland, et al., the court granted a motion for preliminary injunction that specifically ruled:

    • The CTA improperly regulated incorporated entities irrespective of whether they engaged in commercial activity.
    • Congress cannot compel disclosure of information solely for law enforcement purposes under the guise of regulating commerce.
    • The CTA is enjoined.  Enforcement of the Reporting Rule is also enjoined.  Reporting companies need not comply with the CTA’s January 1, 2025 BOI reporting deadline pending further order of the Court.

     

    Implications

    This injunction affects an estimated 32.6 million U.S. businesses (which includes community associations) that were required to disclose information regarding their beneficial owners (board members) before January 1, 2025. While the Justice Department has yet to comment, the ruling marks a temporary victory for corporations and privacy advocates concerned about the CTA’s broad reach.

     

    What’s Next?

    The case, Texas Top Cop Shop, Inc. v. Garland (E.D. Tex., No. 4:24-cv-00478), will likely see further legal battles as the Justice Department evaluates its next steps.

     

    What Does This Mean?

    For now, the preliminary injunction halts the reporting requirements nationwide.  This means that associations that have not filed their BOI report are not required to do so by January 1, 2025.  Stay tuned for updates as this case develops and what it means for community associations.

     

    Contact your favorite HGCT attorney for additional information.