PRESS | Eleventh Circuit Court of Appeals Reverses Previous NSBA, Small Business Win over Corporate Transparency Act (CTA)
- NSBA
- 2 days ago
- 2 min read
NSBA will continue to monitor this breaking news related to the Corporate Transparency Act (CTA) and these latest reverses the small-business win previously secured over this unconstitutional regulation.
FOR IMMEDIATE RELEASE
Tuesday, Dec. 16, 2025
Contact:
Molly Brogan
202-552-2904
Washington, D.C. – Earlier today, the Eleventh Circuit Court of Appeals ruled against NSBA in its lawsuit against the Corporate Transparency Act (CTA), citing that Congress was within Congress’s Commerce power to enact the CTA. While this latest move is deeply unsettling, NSBA is continuing to analyze the ruling but is urging small businesses not to panic – yet.
Earlier this year, Treasury published an interim rule stating they will NOT take any enforcement actions under the CTA on U.S. citizens or domestic reporting companies or their beneficial owners. That is still an interim rule, however, so if that is not finalized or a new administration repeals the rule, small businesses will be back in Treasury’s crosshairs.
“Obviously, we are very disappointed by this ruling and its impact on small businesses,” stated NSBA President and CEO Todd McCracken. “While small businesses still remain safe today against the unfair CTA burden, it is now imperative that Congress pass legislation that permanently repeals the CTA.”
NSBA has been leading the charge for years against the CTA and filed the first lawsuit in the nation against Treasury over this unfair regulatory regime. Unfortunately, this decision does nothing to stem the massive invasion of privacy the CTA will be for small businesses.
“We maintain that, while the commerce clause might give Congress the power to regulate the commercial activities businesses engage in, the states and states alone are empowered to regulate the entities themselves. The CTA imposes reporting obligations merely because the entities are formed, not because they engage in commercial activity,” stated Thomas Lee, Special Counsel, Hughes Hubbard & Reed, LLP and part of the NSBA legal team.
Furthermore, regulation of the maintenance and operation of a separate corporate entity has always been under the exclusive purview of the states—only when a separate corporate entity engages in some activity otherwise regulated by Congress does federal jurisdiction arise.
“We respect the Court’s decision but respectfully disagree with it, and we are considering our options for seeking review by the Supreme Court,” stated Lee.
“We have known from the start that the only way to stop the CTA is for Congress to act. We fully support the goal of stemming money laundering – but we cannot allow the federal government to charge small businesses with the enforcement of it, which is exactly what the CTA will do,” stated McCracken.
Click here for NSBA’s CTA Resource page.
Celebrating nearly 90 years in operation, NSBA is a staunchly nonpartisan organization advocating on behalf of America’s entrepreneurs. NSBA's 65,000 members represent every state and every industry in the U.S. Please visit www.NSBAadvocate.org, or follow us at @NSBAAdvocate.
