Introduction
In 2021, Congress enacted the Corporate Transparency Act (CTA) to enhance transparency in corporate ownership, aiming to combat illicit financial activities such as money laundering and fraud. The CTA mandates that certain business entities disclose their beneficial ownership information (BOI) to the Financial Crimes Enforcement Network (FinCEN), a bureau of the U.S. Department of the Treasury. This article provides an update on recent developments affecting the enforcement and scope of the CTA, following the insights previously shared by Danielle Dudai, Esq., in the Firm’s Blog Post, “The Corporate Transparency Act (CTA) and Beneficial Ownership Information (BOI) Reporting.”
Recent Developments
- Suspension of Enforcement
On February 27, 2025, FinCEN announced a suspension of enforcement actions related to the CTA. This means that reporting companies are not currently required to file or update BOI reports by the existing deadlines. FinCEN stated that no later than March 21, 2025, it intends to issue an interim final rule that extends BOI reporting deadlines. No fines or penalties will be issued, and no enforcement actions will be taken, until such interim final rule becomes effective and the new relevant due dates in the interim rule have passed.
- Proposed Rulemaking to Narrow Scope
Further to FinCEN’s announcement, on March 2, 2025, the U.S. Department of the Treasury announced that even after the forthcoming rule changes take effect, it will not enforce the CTA against U.S. citizens or domestic reporting companies. The Treasury Department plans to issue a proposed rulemaking to narrow the scope of the CTA’s requirements to foreign reporting companies only.
Implications for Businesses
These developments indicate a significant shift in the enforcement and applicability of the CTA:
- Domestic Entities: Domestic reporting companies and their beneficial owners are currently not required to file BOI reports under the existing deadlines, and they will likely be exempt from future reporting requirements once the proposed rulemaking is finalized.home.treasury.gov+4hklaw.com+4swlaw.com+4
- Foreign Entities: Foreign reporting companies registered to do business in the United States should anticipate forthcoming BOI reporting requirements and stay informed about the new deadlines and compliance obligations.
Conclusion
The recent announcements by FinCEN and the Treasury Department represent a notable change in the implementation of the CTA, particularly concerning domestic businesses. Companies are advised to monitor these developments closely and consult with legal counsel to understand how the proposed changes may affect their reporting obligations. We will continue to provide updates as new information becomes available.
For more detailed information on the CTA and BOI reporting requirements, please refer to the previous article by Danielle Dudai, Esq., “The Corporate Transparency Act (CTA) and Beneficial Ownership Information (BOI) Reporting.”
Note: This article is for informational purposes only and does not constitute legal advice.
About the Authors:
Michelle K. Suarez, Esq. is the Founding partner and CEO of The Entrepreneur Lawyers, P.A. She provides strategic legal counsel to businesses, specializing in corporate law, commercial litigation, franchising, private equity, and intellectual property. With a focus on aligning legal strategies with business goals, Michelle helps entrepreneurs and established companies navigate complex legal matters. She is also actively involved in initiatives that support entrepreneurial growth in Florida.
Giuliana Madonia is a law clerk in her second year at Nova Southeastern University College of Law (Class of 2026).
