Corporate Transparency Act

IMPORTANT UPDATE

On October 24, 2024, CAI’s preliminary injunction request was DENIED by the federal judge in this case. This current result means your association board must report BOI information to FinCEN by January 1, 2025, or face financial and criminal penalties.

While this decision was not the outcome we had hoped for, it does not mark the end of CAI’s efforts. CAI appealed the court’s denial of the preliminary injunction request on November 4, 2024, and on November 12, 2024, filed its opening brief of the appeal in the Fourth Circuit.

CAI’s other lobbying and advocacy efforts continue on Capitol Hill and the lawsuit itself is continuing to go through the legal process even as the preliminary injunction decision is being appealed. 

Corporate Transparency Act

The Corporate Transparency Act (CTA) was signed into law Dec. 2020 and is now in effect for many community associations. This law will require community associations with fewer than 20 employees and less than $5 million in annual revenue to disclose beneficial owners’ information to the Department of Treasury’s Financial Crimes Enforcement Network (FinCEN). 

While we support the goal of stopping money laundering and funding schemes for terrorist activity, this is not good public policy for community association boards of directors. CAI believes community associations were unintendedly caught up in this law which is intended for corporations laundering money for terrorist activity.  Failure of a volunteer community association boards to comply—intentional or not—could result in up to $10,000 in fines and up to two years in prison. 

Video Transcript

CAI's Lawsuit:

On September 10th, CAI filed a lawsuit against the U.S. Department of the Treasury, Secretary Janet Yellen, and the director of the Financial Crimes Enforcement Network, challenging the application of the Corporate Transparency Act on community associations. This action is being taken to protect our members from the burdensome and unnecessary requirements of the Corporate Transparency Act. Both the lawsuit complaint and motion for preliminary injunction can be found here:

Community Associations Institute v United States Department of Treasury Complaint (Filed September 10, 2024)

Community Associations Institute v United States Department of Treasury Complaint (Filed September 10, 2024)
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Community Associations Institute v United States Department of Treasury Motion for Preliminary Injunction (Filed September 10, 2024)

Community Associations Institute v United States Department of Treasury Motion for Preliminary Injunction (Filed September 10, 2024)
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Defendant's Opposition to Motion for Preliminary Injunction (Filed October 2, 2024)

Defendant's Opposition to Motion for Preliminary Injunction (Filed October 2, 2024)
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CAI Reply In Support Of Preliminary Injunction Motion (Filed October 7, 2024)

CAI Reply In Support Of Preliminary Injunction Motion (Filed October 7, 2024)
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Judge Ruling on Preliminary Injunction (Filed 10/24/24)

Judge Ruling on Preliminary Injunction (Filed 10/24/24)
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CAI Notice of Appeal (Filed 11/4/2024)

CAI Notice of Appeal (Filed 11/4/2024)
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CAI Filed Fourth Circuit Brief (Filed 11/12/24)

CAI Filed Fourth Circuit Brief (Filed 11/12/24)
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FAQs And Resources

Want to learn more about CAI's lawsuit?
Check Out CAI's FAQ!
Want to learn more about the Corporate Transparency Act and its impact on community associations?
Check out CAI's guidance document!
FinCEN's FAQ Website HOA Guidance- HOA Relevant Items are C.10, C.17, D.1, and F.5.

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* CAI Letter to FinCEN - Requesting Community Association Exemption
* Coalition Letter in Support of S. 3625 - the Protect Small Business and Prevent Illicit Financial Activity Act
CAI Letter Coalition Letter
FinCEN Report Blog- FinCEN Confirms Most Homeowner Associations Will Need to File Under the CTA
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Includes FAQs, resources on how to contact FinCEN, newsletter, website, and email templates, sample social media posts, and sample social media images.

View Resource
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Act Now!

Tell congress to support H.R. 9045 and exempt community associations from reporting requirements!

Take Action

FinCEN Announces CTA Filing Extension for Communities Impacted by Recent Hurricanes

Has your community been impacted by Hurricanes Milton, Helene, Debby, Beryl, or Francine? Certain associations may be eligible for a 6-month extension for filing BOI information with FinCEN.

If your association is located in an area that qualifies for FEMA relief AND tax filing relief, then the association could receive an additional 6 months to file its BOI information with FinCEN, depending on the deadline for either your association’s initial filing or updated filing.

Please see the following announcements from FinCEN:

NOTE: Should community associations be prepared to file by Dec. 31 if CAI's lawsuit is not resolved or the law has not changed?

Yes. Community associations should be prepared to comply with the act and file the required beneficial ownership information by Dec. 31 if the lawsuit is not resolved or the law has not been amended. While the CAI is actively pursuing legal action to seek an exemption, it is prudent for associations to prepare to comply to avoid potential penalties and ensure they meet all legal requirements.

Can CAI file my association’s BOI information with FinCEN?

No, CAI does not provide services to file an association’s BOI information with FinCEN. If your association’s board has concerns about the filing process and filling out the appropriate forms, then the board should consult with the association’s manager and/or legal counsel to identify professional assistance that may be available to the association. Ultimately, it is up to an association’s board to decide whether or not to utilize professional assistance, as the needs of each association are unique. Please be aware that CAI cannot recommend specific professional services or forecast the cost of services for an association.

CAI Membership

We learned from the National Small Business Association (NSBA) lawsuit that “association standing” protects all members of the organization in the lawsuit. If CAI’s lawsuit is successful in exempting community associations from the Corporate Transparency Act, it is very possible the exemption will only apply to community associations that are members of CAI.

For the time being, CAI recommends that your association sign up for a Homeowner Leader membership, Group option. Up to 15 board members may be listed under this membership option, which should be broad enough to cover the majority of community association boards.

Join CAI Today

Help CAI Fight The Corporate Transparency Act!

Notice: Federal Court Rules Corporate Transparency Act Unconstitutional

On Friday, March 1, a federal court ruled the Corporate Transparency Act (CTA) unconstitutional. The federal government appealed the decision on Monday, March 11. Meanwhile, the Financial Crimes Enforcement Network (FinCEN) has provided notice that, as a result of this opinion, the government is not currently enforcing the Corporate Transparency Act against the plaintiffs in that action: Isaac Winkles, reporting companies for which Isaac Winkles is the beneficial owner or applicant, the National Small Business Association, and members of the National Small Business Association (as of March 1, 2024). Those individuals and entities are not required to report beneficial ownership information to FinCEN at this time. CAI wanted to share this news with you immediately and we will provide additional details as they become available.

Other Current Corporate Transparency Act Lawsuits

Small Business Association of Michigan et al v. Yellen

Small Business Association of Michigan (SBAM)- Small Business Association of Michigan et al v. Yellen et al 1:2024cv00314
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National Small Business Association et al v. Yellen

National Small Business Association (NSBA)- National Small Business Association et al v. Yellen 5:22-cv-1448-LCB
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Texas Top Cop Shop et al v. Garland et al

National Federation of Independent Business (NFIB)/Wyoming dairy/the Mississippi Libertarian Party and two small businesses- Texas Top Cop Shop et al v. Garland et al 4:24-CV-00478
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William Boyle v. Yellen

William Boyle (Individual)
William Boyle v. Yellen 2:24-cv-00081

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Black Economic Council of Massachusetts et al v. Yellen

Black Economic Council of Massachusetts (BECMA), the African Community Economic Development of New England (ACEDONE) and three business owners in Massachusetts- Black Economic Council of Massachusetts et al v. Yellen et al 1:24-cv-11411
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Taylor et al v. Yellen

Utah business owner Phillip Taylor and the nonprofits The People Restored, Ranchers Cattlemen Action Legal Fund United Stockgrowers of America, and Utah OSR Land Cooperative- Taylor v. Yellen, No. 2:24-cv-00527
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Gerald Earl Cummings, II, Lindsay Berschauer, Tayler Hayward, Lisa Ledson, Katerina Eyre, Michael Firestone and Thomas Reilly

Gerald Earl Cummings, II, Lindsay Berschauer, Tayler Hayward, Lisa Ledson, Katerina Eyre, Michael Firestone and Thomas Reilly- Firestone et al v. Yellen et al 3:2024cv01034

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Robert J. Gargasz Co., L.P.A. and Robert J. Gargasz

Robert J. Gargasz Co., L.P.A. and Robert J. Gargasz- Robert J. Gargasz Co., L.P.A. et al v. Yellen 1:2023cv02468
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Hotze et al v Treasury et al (2:24-cv-00210-Z Filed 9/26/24)

Hotze, Rogers, Ramsland, Wallis, and the Association of American Physicans and Surgeons v Treasury et al (2:24-cv-00210-Z Filed 9/26/24)
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Brief of the Small Business Association of Michigan and the Chaldean American Chamber of Commerce as Amici Curiae in Support of Plaintiffs-Appellants USCA4 Appeal: 24-2118 Filed 11/19/24

Brief of the Small Business Association of Michigan and the
Chaldean American Chamber of Commerce as Amici Curiae in
Support of Plaintiffs-Appellants USCA4 Appeal: 24-2118 Filed 11/19/24
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