WASHINGTON - Today, Rep. Lisa McClain (R-Mich.) with several House colleagues requested a delay from Treasury Secretary Janet Yellen in the implementation of the Corporate Transparency Act (CTA). The CTA, which passed the House in 2021, includes complex obligations that businesses must report significant occupational data and sensitive personal information. Without delay, the reporting deadline which runs afoul of Congressional intent will subject millions of small businesses to penalties, fines, and even jail time.
“While CTA intends to target shell corporations engaged in illicit transactions, its language actually targets all legal entities with less than $5 million in annual revenues and less than 20 employees – in other words, every small business in the United States,” the Members of Congress wrote. “Failure to comply can result in fines of over $590 per day, as well as felony charges and up to two years imprisonment. [The Treasury Department’s Financial Crimes Enforcement Network] FinCEN reported estimates that more than 32 million such entities will be affected by the new law just this year, with an additional 6 million each subsequent year as new businesses are formed.”
“In the meantime, a paperwork violation that includes large fines and jailtime is devasting to America’s small business owners simply trying to make ends meet. We ask that you delay CTA’s implementation date to comply with the intent of the law and allow the legalities, distribution of information and complicated reporting requirements to be clarified,” the Members of Congress continued.
This letter comes after FinCEN reported that it has only received 10 percent of the required submissions from affected businesses.
Rep. McClain was joined by Rep. Donald G. Davis (D-N.C.), Rep. Bill Huizenga (R-Mich.), Rep. French Hill (R-Ark.), Rep. Tom Emmer (R-Minn.), Rep. Cathy McMorris Rogers (R-Wash.), Rep. Vern Buchanan (R-Fla.), Rep. Maria Elvira Salazar (R-Fla.), Rep. Randy Weber Sr. (R-Texas), Rep. Darin LaHood (R-Ill.), Rep. Jack Bergman (R-Mich.), Rep. Jim Jordan (R-Ohio), Rep. Beth Van Duyne (R-Texas), Rep. Bob Good (R-Va.), Rep. Rich McCormick (R-Ga.), Rep. Harriet M. Hageman (R-Wyo.), Rep. John Rose (R-Tenn.), Rep. John R. Moolenaar (R-Mich.), Rep. Byron Donalds (R-Fla.), Rep. James R. Baird (R-Ind.), Rep. Tom McClintock (R-Calif.), Rep. Ann Wagner (R-Mo.), Rep. Earl L. “Buddy” Carter (R-Ga.), Rep. Neal P. Dunn M.D. (R-Fla.), Rep. Brett Guthrie (R-Ky.), Rep. Young Kim (R-Calif.), Rep. Scott Fitzgerald (R-Wis.), Rep. Dusty Johnson (R-S.D.), Rep. Erin Houchin (R-Ind.), Rep. Debbie Lesko (R-Ariz.), Rep. Mike Carey (R-Ohio), Rep. Brad Finstad (R-Minn.), Rep. Jodey C. Arrington (R-Texas), Rep. Michael Guest (R-Miss.), Rep. Frank D. Lucas (R-Okla.), Rep. Roger Williams (R-Texas), Rep. Sam Graves (R-Mo.), Rep. Mario Diaz-Balart (R-Fla.), Rep. Glenn “GT” Thompson (R-Pa.), Rep. Andy Biggs (R-Ariz.), Rep. Pete Stauber (R-Minn.), Rep. Monica De La Cruz (R-Texas), Rep. Ralph Norman (R-S.C.), and Rep. Lloyd Smucker (R-Pa.).
A copy of the letter can be found here.
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