On May 20, CAI filed an amicus brief in the United States Court of Appeals for the 11th Circuit in National Small Business United d/b/the National Small Business Association, et al., v. Janet Yellen, in her official capacity as Secretary of the Treasury, et al. Read the amicus brief here.

This case arises from a constitutional challenge by the National Small Business Association regarding the Corporate Transparency Act, a federal law requiring certain business entities to register with the Treasury Department’s Financial Crimes Enforcement Network (FinCEN). The case was filed in the Northern District of Alabama, with that court deciding in March 2024 that the act was unconstitutional because it exceeds Congress’ authority. The government appealed the case to the 11th Circuit, and CAI’s amicus brief was filed in support of the district court’s finding.

Many community associations will be impacted by this new law and will have a duty to file certain beneficial ownership information with FinCEN; the filing deadline for existing corporations is set for Jan. 1.

The Corporate Transparency Act is intended to improve the detection of certain suspicious activities carried out by business entities such as money laundering and terrorist financing. CAI supports that goal but does not believe the act should apply to local, volunteer-driven, nonprofit organizations that exist with the primary purpose of maintaining communities and providing services to residents. This amicus brief allowed us to highlight the negative impacts the act will have on the community association industry and to illustrate that the act’s reach is impermissibly broad.

The following CAI members and fellows in CAI’s College of Community Association Lawyers drafted this critical brief: Edmund Allcock, a CCAL fellow with Allcock Marcus in Braintree, Mass.; Norman Orban, an attorney with Allcock Marcus; Julie Howard, a CCAL fellow with NowackHoward in Atlanta; Brendan Bunn, a CCAL fellow with Chadwick, Washington, Moriarty, Elmore & Bunn in Fairfax, Va.; Thomas Ware, a CCAL fellow with Kulik Gottesman Siegel & Ware in Sherman Oaks, Calif.; Todd Sinkins, a CCAL fellow with Rees Broome in Tysons Corner, Va.; and Steven Casey, an attorney with Jones Walker in Birmingham, Ala. We thank these individuals for their time and dedication to this issue.

In addition to this pending federal lawsuit, there are two pieces of legislation related to the Corporate Transparency Act in Congress that, if passed before the end of the session, will help community associations.

DELAY: S. 3625, the Senate companion bill to H.R. 5119 that passed the House of Representatives 400-1 is still in play.  CAI continues to meet with Democrats on the Senate Banking Committee to urge them to delay implementation the ownership filing requirements by one year. Senate Republicans are willing to pass this bill, but Democrats haven’t been willing to budge.

REPEAL: The House is frustrated by the Senate’s lack of movement, so it introduced another bill, H.R. 8147, that will repeal the Corporate Transparency Act. This is a Republican-dominated bill in the House.

Visit www.caionline.org/takeaction to contact your member of Congress today.

>>Access additional CAI resources on the Corporate Transparency Act.

>> CAI educates courts about important legal and policy issues in cases related to the community association industry through the amicus curiae program. To learn more or to submit a request for an amicus brief, contact Phoebe E. Neseth, Esq., at pneseth@caionline.org, or visit our site.

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