Hoosier State Today

A recent column by Natalie Robinson, the Indiana director of the National Federation of Independent Business (NFIB), calls for the repeal of the Corporate Transparency Act. This federal legislation has been criticized for imposing new reporting requirements on small business owners, which many find burdensome.

The law took effect on January 1 and requires over 30 million small businesses, including tens of thousands in Indiana, to report personal information about their beneficial owners to the U.S. Treasury Department. Beneficial owners are defined as individuals who control or own a part of the business.

Robinson points out that the new requirements might have serious consequences for business owners who make mistakes in reporting. "If owners make a mistake and don’t follow the rules exactly, they could be charged a late fee, fined $10,000 and sent to prison," she noted.

A survey conducted by NFIB showed that 83 percent of small business owners nationwide are unaware of the mandate, putting them at risk of inadvertent legal violations.

The Act had significant bipartisan support in Congress, as it was promoted as a measure to help catch criminals who might use small businesses to launder money. However, Robinson argues that criminals are unlikely to comply with such regulations and that legitimate businesses are left to deal with increased paperwork. "Usually, at a small business, the compliance officer is the owner," she stated.

Part of Robinson’s frustration stems from the fact that the Corporate Transparency Act does not apply to larger businesses, targeting only those with 20 or fewer employees—a typical size for small businesses in Indiana. Additionally, she raises concerns about privacy risks. "Hackers have stolen people’s personal information from several federal databases. This database of Main Street business owners would be a tempting target," Robinson warned.

Recent discussions with Indiana's congressional members have been aimed at garnering support for the Repealing Big Brother Overreach Act, which seeks to eliminate the beneficial owner mandate. While the need to address money laundering is recognized by NFIB members, Robinson believes the Corporate Transparency Act fails to aid law enforcement and rather burdens law-abiding business owners.

Natalie Robinson remains vocal in her stance that the Act should be repealed to prevent unnecessary complications for small businesses as they navigate challenging economic conditions.