Reporting requirements under the Corporate Transparency Act have been reinstated for community associations, which now have until March 21 to file an initial, updated, or correct beneficial ownership information report with the Financial Crimes Enforcement Network.

The most recent development comes after the U.S. District Court for the Eastern District of Texas on Feb. 17 granted the government’s motion for a stay in the nationwide injunction related to Smith v. United States Department of Treasury. The court cited the U.S. Supreme Court’s decision to stay the preliminary nationwide injunction in the Texas Top Cop Shop, Inc., matter as precedent for its decision.

The Smith case was the last remaining nationwide order pausing beneficial ownership reporting requirements.

After the ruling, FinCEN extended the reporting deadline to March for most companies.

Community associations need to continue to be vigilant and closely monitor legal developments regarding the Corporate Transparency Act. Several U.S. district courts have taken up cases related to the constitutionality and application of the act.

CAI has taken a number of steps to protect community associations from the impacts of the act — from filing a lawsuit against the U.S. Department of Treasury and advocating for legislative reform to pursuing regulatory exemptions.

The act imposes new reporting requirements on many entities, including community associations. Under the law, volunteer board members of condominiums, homeowners associations, and housing cooperatives will be required to provide sensitive personal information to FinCEN. These requirements were designed to combat illegal activities including terrorism financing and money laundering. The federal government has taken a very broad approach with this law, impacting organizations like community associations that are extremely unlikely to be engaged in such activities. CAI believes the application of the act to community associations is an overreach, unintentional, and potentially unconstitutional.

Lobbying and Advocacy Efforts Continue

While the fight continues in courts, Congress is addressing legislative initiatives to delay the act. H.R. 736 – Protect Small Businesses from Excessive Paperwork Act of 2025 was introduced by Rep. Zachary Nunn (R-Iowa) and S. 505 – A bill to amend title 31, United States Code, to modify the deadline for filing beneficial ownership information reports for reporting companies formed or registered before January 1, 2024 was introduced by Sen. Tim Scott (R-S.C.). If passed, these bills will delay the act’s implementation for pre-existing entities to Jan. 1, 2026. H.R. 736 was passed by a vote of 408-0 on Feb. 10 and was sent to the Senate Banking, Housing, and Urban Affairs Committee for consideration, where S. 505 also was introduced.

>>CAI is urging members to connect with their senators to support H.R. 736 and S. 505 and share the request with colleagues, clients, and neighbors.  

CAI’s Lawsuit Also Ongoing

CAI filed a lawsuit in September challenging the application of the act on community associations. In October, CAI’s preliminary injunction request was denied. CAI appealed the denial and filed its opening brief of the appeal in November. The government responded to CAI’s appeal on Feb. 7, and CAI has until Feb. 28 to file its reply.

This is a developing issue. Association boards should remain vigilant and informed on these ongoing updates.

>>Access additional CAI updates and resources on the Corporate Transparency Act.