What’s next for the Corporate Transparency Act? Key SCOTUS and Congressional Developments, H.R. 425 - by Phoebe Neseth

Last year, Financial Crimes Enforcement Network (FinCen) issued an interim final rule removing the requirement for U.S. companies and U.S. persons to report beneficial ownership information to FinCEN under the Corporate Transparency Act.

The CTA was signed into law in December 2020 and affects many community associations. This law requires community associations with fewer than 20 employees and less than $5 million in annual revenue to disclose beneficial owner information to FinCEN.

Under the interim final rule, FinCEN revises the definition of reporting company to mean only entities formed under the law of a foreign country that have registered to do business in any U.S. state or tribal jurisdiction by filing documents with a secretary of state or similar office (formerly known as foreign reporting companies). FinCEN also exempts entities previously known as domestic reporting companies from BOI reporting requirements.

Through this interim final rule, all entities created in the U.S. – including those previously known as domestic reporting companies and their beneficial owners will be exempt from the requirement to report BOI to FinCEN. This interim ruling serves as a temporary, binding set of rules until a more comprehensive final rule is issued and published. The act remains federal law, though currently paused by FinCEN. We continue to await a final rule from FinCEN.

April 20, 2026 Congressional CTA Effort Update

In January 2025, Ohio Rep. Warren Davidson introduced H.R. 425 – Repealing Big Brother Overreach Act. If passed, it would fully repeal the Corporate Transparency Act. This bill currently has 191 cosponsors in the House. The week of April 20, 2026, the House Financial Services Committee, where the bill has been assigned, was marking up this bill.

Marking up a bill refers to the formal process in which a committee reviews, debates, and amends a proposed law before deciding whether to send it to the full chamber for a vote. The markup stage is where committee members examine the bill in detail after public hearings to refine its language, clarify provisions, or make substantive changes. The goal is to determine whether the bill should be reported to the House or Senate floor and, if so, in what form.

Supreme Court of the United States (SCOTUS) CTA Effort Update

In related news, on April 15, 2026 the National Small Business Association filed a petition for writ of certiorari with the U.S Supreme Court in its ongoing lawsuit over the constitutionality of Corporate Transparency Act. This petition by NSBA represents a formal request to review a previous ruling from the 11th Circuit Court of Appeals that upheld the constitutionality of CTA.

CAI filed an amicus brief in this matter in May 2024 with the 11^th Circuit and will be filing another amicus brief in April 2026 urging the high court to overturn the act.

Learn more about CAI’s Corporate Transparency Act efforts and federal lawsuit here www.caionline.org.

Phoebe Neseth, Esq. is vice president, government relations, public affairs and legal at Community Associations Institute.