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BREAKING NEWS – Corporate Transparency Act on Hold

as of Monday, March 3, 2024

On Friday March 1, 2024, the U.S. District Court for the District of Alabama declared the Corporate Transparency Act (CTA) unconstitutional. In the case of National Small Business Association v. Yellen (Case No. 5:22-cv-01448) [1], initiated by the National Small Business United, the challenge was against the CTA’s mandate for small businesses to disclose their beneficial owners to the Financial Crimes Enforcement Network (FinCEN).

The ruling has the effect of suspending all BOI filing requirements for now, all enforcement actions, and all compliance concerns including questions of “practicing law without a license.” Experts believe the ruling will be appealed, probably to the Supreme Court, so this is a temporary filing requirement suspension until a final appeal is exhausted. Voluntary filing appears to still be allowed if for some reason a client desires to file.

Changes in your Refund or Tax Due

After filing their tax returns, some taxpayers may receive letters from the IRS. Many of these letters just explain a minor math mistake or other error on the person’s return, which IRS personnel corrected with little or no effect on the person’s refund or tax owed. However, some IRS letters notify taxpayers of larger issues with their returns, such as multiple or major math errors, or ineligibility for claimed credits or deductions. These notices may inform taxpayers of a significant decrease in their refunds, or significant increase in how much tax they owe.

Taxpayers who receive IRS letters about their returns should review the notices carefully, and check any proposed adjustments against their tax records. The Taxpayer Bill of Rights ensures that the IRS must fairly review any objections a taxpayer raises to an IRS decision.

Before objecting to an IRS letter, taxpayers should remember that tax refunds may also be adjusted for a variety of non-tax reasons, such as past-due child support. If your refund amount is different than stated on the filed tax return, part or all of your refund may have been used to pay off (offset) past-due federal tax, student loans, state income tax or other past-due debts.

You’ll receive a notice from the IRS if such an offset occurs that will show the original tax refund amount, the offset amount, as well as the name, address and telephone number of the agency receiving the payment.

If you haven’t received your refund yet, you may be able to check the status using the IRS’ “Where’s my Refund?” tool: https://www.irs.gov/refunds.