In its filing to the Supreme Court, the DOJ said it expects to succeed, in part because the law’s “requirements fall comfortably within Congress’s authority under the Commerce Clause to regulate economic activities,” and are “also necessary and proper to effectuate several of Congress’s enumerated powers, including the power to regulate interstate and foreign commerce and to collect taxes, as well as Congress’s powers with respect to foreign affairs.”
By Mary Hightower
U of Arkansas System Division of Agriculture
Jan. 6, 2025
Fast facts
- Fifth Circuit reinstated, then paused Corporate Transparency Act in December
- CTA set for March 25 court date
- DOJ has asked SCOTUS to act
FAYETTEVILLE, Ark. — After being reinstated and paused again by panels of the United States 5th Circuit Court of Appeals in December, the Corporate Transparency Act has a March 25 date before the whole court, unless the U.S. Supreme Court gets to it first.
On New Year’s Eve, the Department of Justice asked SCOTUS to stay an injunction on the Corporate Transparency Act issued Dec. 3 by a federal court in Texas. In the days prior to the DOJ request, a panel of the 5th Circuit Court of Appeals stayed the injunction on Dec. 23. A second panel of the same court reinstated the injunction on Dec. 26.
In its filing to the Supreme Court, the DOJ said it expects to succeed, in part because the law’s “requirements fall comfortably within Congress’s authority under the Commerce Clause to regulate economic activities,” and are “also necessary and proper to effectuate several of Congress’s enumerated powers, including the power to regulate interstate and foreign commerce and to collect taxes, as well as Congress’s powers with respect to foreign affairs.”
It’s not known if, or when, SCOTUS might take up the case. The court is currently working through cases set for its October 2024 term, which includes cases scheduled through March 2025.
What is CTA?
The Corporate Transparency Act, or CTA, was still a little-known law heading into the months before the deadline for businesses to file beneficial owner information in order to comply. The act was passed in 2021 with a goal of cracking down on shell companies and preventing money laundering, said Elizabeth Rumley, senior staff attorney at the National Agricultural Law Center. Reporting required by the law began Jan. 1, 2024, and was expected to affect more than 32 million businesses, including more than 230,000 farm operations, according to the American Farm Bureau.
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