U.S. Senator Tommy Tuberville (R-AL) is ramping up support for his Repealing Big Brother Overreach Act ahead of its reintroduction in the 119th Congress. The proposed legislation seeks to repeal the Corporate Transparency Act (CTA), a law that critics argue imposes burdensome reporting requirements on small businesses and threatens them with severe penalties for noncompliance.
The CTA, originally slated to take effect on January 1, 2025, is currently under a court-ordered stay as legal challenges unfold. Under the law, small business owners would be required to disclose detailed financial information to the U.S. Treasury Department’s Financial Crimes Enforcement Network (FinCEN) or face penalties of up to $10,000 per violation and up to two years in prison.
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In a recent floor speech and an op-ed, Senator Tuberville highlighted the dangers posed by the CTA, describing it as a “big government overreach” that disproportionately impacts small business owners.
“The Corporate Transparency Act is an outright attack on the 32 million small businesses in this country,” Tuberville said. “From farmers to restaurant owners and gym operators, the CTA specifically targets working Americans with LLCs. Failure to comply could mean jail time and massive fines. Small businesses are the backbone of this country, and the CTA is a slap in the face to every small business owner. This overreach must be repealed immediately.”
The Repealing Big Brother Overreach Act has garnered endorsements from over 100 trade organizations, including the National Federation of Independent Business, the S Corporation Association, and Americans for Tax Reform. These groups argue that the CTA’s reporting requirements unfairly burden small business owners, many of whom lack the resources to navigate the law’s complex regulations.
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The CTA was passed as part of the FY21 National Defense Authorization Act (NDAA) with the stated goal of combating money laundering and financial crimes. The law requires individuals with an ownership interest in LLCs to submit personal and financial data to FinCEN. Critics contend that the law:
- Targets small businesses disproportionately while offering exemptions for larger corporations.
- Creates privacy risks by mandating the disclosure of sensitive personal data.
- Imposes severe penalties that could bankrupt or imprison small business owners for minor violations.
Senator Tuberville is working to build bipartisan support for the Repealing Big Brother Overreach Act and plans to formally reintroduce the legislation in the coming weeks.
“This law is an affront to the hardworking Americans who keep our economy running,” Tuberville said. “The government has no business criminalizing small business owners for failing to comply with a bureaucratic nightmare. We must repeal the CTA and protect the privacy and livelihoods of our entrepreneurs.”
The debate over the CTA is expected to intensify as the federal court decision looms and small business advocacy groups amplify their calls for repeal.
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