This is the Cato Daily podcast for Thursday, February 20th, 2025. I'm Caleb Brown.

The so-called Corporate Transparency Act is now on hold. That law, if implemented, would compel

companies large and small to report to the feds a lot of very sensitive information that,

quite frankly, is none of their business. Caleb Kruckenberg is litigation director at the Center for Individual Rights.

He's representing Texas Top Cop Shop, among others, in a current federal case that will be

closely followed by anyone who cares about financial privacy and burdensome regulation.

We spoke last week.

The Corporate Transparency Act sounds fairly unobjectionable, but as I spoke with Brent

Scorup and Jennifer Shulp recently about some of the contours of this law, it seems that, at

least for a long time, it wasn't really

clear what this law obligated companies to do or exactly why this particular set of information

was necessary for the federal government to have access to. Can you tell me what you understand

this law to do and how it has infringed upon your clients? What has been kind of amusing for me

throughout this process is even now nobody can really say or agree on what this law does.

There are lots of different theories.

But what we do know is that however you construe it, it's bad.

And the government thinks it does a lot.

But the two questions that kind of were left when Congress passed the

Corporate Transparency Act were, one, exactly who this applies to, and two, when. So the first

question and just kind of a refresher, the CTA says to quote unquote business entities, which includes actually a

lot of nonprofits, as I will discuss later, but it applies to these when they've registered

with a state. And these have to disclose their beneficial owners, which is defined kind of strangely as

...