Corporate Transparency Act at Supreme Court

Around 5:00 p.m. on New Year’s Eve, the U.S. government filed a motion with the Supreme Court, asking it to stay the current injunction on the Corporate Transparency Act (CTA). Alternatively, the government asked the Court to limit the injunction so that it would apply only to the parties in Texas Top Cop Shop v. Garland—requiring most Americans to comply with the law’s invasive reporting requirements. CIR will file its opposition in the coming days.

On December 3, a federal district judge granted CIR’s motion for a preliminary injunction on the CTA. The court found that the federal surveillance law—which compels more than 32 million small businesses to report private information to the federal government—was “likely unconstitutional” since it exceeded Congress’ lawful authority. Because it would be impractical and unwise to limit the injunction only to the plaintiffs (which included the National Federation of Independent Business, on behalf of nearly 300,000 small businesses it represents) while enforcing the law against everyone else, the court appropriately blocked the CTA’s reporting deadline nationwide.

As of January 2, 2025, the federal government is barred from enforcing the CTA’s reporting mandate.

Solicitor General Elizabeth Prelogar asked the Supreme Court to stay the injunction and allow the CTA to take full effect during litigation in the Fifth Circuit and through any subsequent litigation in the Supreme Court. In addition, she invited the Supreme Court to consider the application as a petition for the Court to hear the injunction on its merits.

The Supreme Court should uphold the injunction on the CTA both to prevent the irreversible harms caused by the enforcement of a sweeping and unconstitutional reporting mandate and to prevent the widespread chaos and confusion that would follow for millions of small business owners nationwide if their legal obligations under the federal regulations change for the fourth time in a month.