Good News on the Corporate Transparency Act!
By Jeffrey S. Watson
On Sunday, March 2, 2025, the Secretary of the Treasury issued an announcement which dramatically changed the Corporate Transparency Act (CTA) and how it will be enforced. To understand how this came about, I went back and read the opening sections of the CTA and noticed that repeatedly, the CTA put all the responsibility and authority for enforcing the CTA and FinCEN, etc., under the auspices of regulations to be created by the Secretary of the Treasury. Such wording is typical of a Congress that was a firm believer in enacting legislation and then letting the regulatory bureaucracy build it out.
Due to the United States Supreme Court getting rid of the Chevron Doctrine, a new administration in the White House, and new cabinet secretaries, we can expect to see a lot of change. In response to an outcry from American small business owners, the CTA has been suspended by the Secretary of the Treasury as it relates to all domestic (American) companies. The act is still in place as to foreign companies registering to do business in the United States.
This suspension will remain in place until one of three things happens: the Supreme Court finally grapples with the issue of whether the CTA is constitutional (my gut feeling is that the Treasury’s actions over the weekend indicate that they don’t believe it is); the Secretary of the Treasury would change his mind; or Congress enacts legislation revoking the CTA in its entirety or significantly amends it so that going forward, it only applies to foreign companies who want to do business in the U.S. I believe the third option would be the best because it would mean Congress is taking responsibility and doing something beneficial instead of just passing a 22-page piece of legislation that puts the responsibility for how to enact it on a bunch of bureaucrats.
To summarize the latest news on the CTA, if you have an American-based company (created in the U.S. by a U.S. citizen and registered with its Secretary of State), the CTA has been suspended by a decision from the Secretary of the Treasury of the United States. This is the person whom the legislation empowered with the responsibility of implementing the CTA to begin with.
Jeffery S. Watson is an attorney who has had an active trial and hearing practice for more than 25 years. As a contingent fee trial lawyer, he has a unique perspective on investing and wealth protection. He has tried over 20 civil jury trials and has handled thousands of contested hearings. Jeff has changed the law in Ohio four times via litigation. Read more of his viewpoints at WatsonInvested.com.
Click here for the latest update on the Corporate Transparency Act.
