CAI’s Litigation Challenge to the Corporate Transparency Act Stalls: What Do Community Associations Need to Know?

A recent litigation challenge to the Corporate Transparency Act (“CTA”) specific to community associations has hit a roadblock. The Community Associations Institute (“CAI”), a not-for-profit organization that represents homeowners, condominiums, and other community associations, filed litigation seeking to exempt community associations from the CTA’s reporting requirements. As part of this lawsuit, CAI sought a preliminary injunction to postpone the deadline for community associations to comply with the CTA’s reporting requirements until the case could be heard.  

On October 24, 2024, a federal court denied the preliminary injunction request and, therefore, the CTA and its reporting requirements remain in effect and condominium, community association, and co-op boards must complete the CTA reporting requirements by the January 1, 2025 initial reporting deadline.

Additional Information:

• Click here for LP’s primer on the CTA specifically for Illinois community associations.

• Click here for additional resources from LP regarding the CTA, including compliance requirements, filing deadlines, and Beneficial Ownership Information Report instructions.

• It is expected that the CAI will continue its efforts to exempt community associations from the CTA’s reporting requirements. Click here for additional information from CAI on their CTA advocacy efforts. 

• Notably, a federal court recently ruled in a similar lawsuit brought by the National Small Business Association (“NSBA”) that the CTA is unconstitutional but only suspended enforcement of the CTA’s reporting requirements for the specific members of the plaintiff organization. Click here for LP’s article on the NSBA case.    

LP is committed to keeping our community association clients informed of, and prepared to proactively and successfully navigate, any changes in the law. For questions regarding the CTA, including reporting requirements, or other issues facing your condominium or community association or co-op, please contact Howard Dakoff, Laura Marinelli, Adam Kahn, or Molly Mackey of LP’s Community Association Group.