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Update: Taxpayers Challenge the Corporate Transparency Act

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Nicholas J. Stock
Business & Tax Law News
April 2, 2024

Another challenge to the CTA has surfaced in the United States District Court for the District of Maine. In William Boyle v. Janet Yellen et al., No. 2:24-CV-00081, William Boyle challenges the constitutionality of the Corporate Transparency Act (CTA), asserting that the law infringes on states' regulatory authority and violates the 9th and 10th amendments. Boyle contends that beneficial ownership reporting requirements under the CTA impose undue burdens, particularly on small, privately-owned businesses and non-commercial organizations.

Boyle argues that the CTA is too broad in scope, affecting entities who engage solely in intrastate commerce, like his two Maine LLCs that hold real estate. Boyle's case echoes similar challenges to the CTA like the recent ruling in National Small Business United v. Yellen (NSBA), No. 22-cv-01448, where the Northern District of Alabama held the CTA unconstitutional. See our other post here: Will Recent Alabama Ruling Stay Implementation of the Corporate Transparency Act?: Foster Swift.

Boyle also argues that the CTA is less rigorous than existing customer due diligence rules, potentially resulting in a database of personal information that primarily targets law-abiding domestic entities, rather than the foreign entities the law aims to combat.

Like other plaintiffs, Boyle argues that the CTA overreaches federal authority, placing undue burdens on domestic entities while circumventing its intended purpose of combating money laundering and financial crime.

Have further legal questions? We encourage you to contact one of Foster Swift's designated CTA team members:

Rob Hamor (Southfield) Amanda Dernovshek (Lansing)
Nick Stock (Grand Rapids) Nick Oertel (Lansing)
J.V. Anderton (Lansing) Megan Cochrane (Lansing - Legal Assistant)
Terri Bolyard (Lansing - Paralegal)