You would have faced up to two years in prison and a $10,000 fine if you owned a farm or small business and failed to comply with the corporate transparency law before January 1, 2025. But you are not allowed to do that. hook – at least, for now!
“The rollout of this measure has been a failure on the part of the Treasury Department,” said Kent Bacus, executive director of government affairs at the Treasury Department. National Beef Breeders Association (NCBA).
A few weeks ago, the U.S. District Court for the Eastern District of Texas granted a nationwide preliminary injunction in Texas Top Cop Shop, Inc. v. Garland, and said the corporate transparency law was likely unconstitutional and therefore temporarily blocked the government from enforcing it.
The law requires farmers and small businesses to file what’s called a “beneficiary information report” in an effort to crack down on businesses that may have been created for the purpose of money laundering or financing terrorist activities.
The report would require many farmers and small business owners to provide confidential information to the U.S. Treasury Department’s Financial Crimes Enforcement Network, or FinCEN, for short. The deadline for completing this report was supposed to be January 1, 2025.
“We are not out of the woods yet, because if the court decides that the preliminary injunction should be lifted, FinCEN could then move forward and begin enforcing it immediately. So it’s important that people continue to pay close attention to it,” says Bacus.
That’s why he offers these tips to farmers and small business owners.
“For your personal business, this is the time to talk to your advisors, your tax preparers, your attorneys, and find out, if this goes forward, is this something you’re going to have to comply with? » said Bacus.
If the law takes effect, it would affect more than 32 million small businesses, including millions of farmers and agricultural producers.
“Ultimately, it’s going to take an act of Congress to go back and amend this, to make things right, and not create a criminal class out of so many small businesses,” he says.
Before the ruling, small businesses that met certain criteria would have had to file reports with the Treasury Department by January 1, 2025, or face fines and criminal penalties.
The preliminary measure will remain in effect until the conclusion of the legal proceedings, at which time the court may issue a permanent injunction. In the meantime, the government is expected to appeal the preliminary injunction.
CLICK BELOW to listen to the Hoosier Ag Today radio report.