The U.S. Treasury Department’s Financial Crimes Enforcement Network (FinCEN) on March 21, 2025 issued an interim final rule that fundamentally alters compliance obligations under the Corporate Transparency Act (CTA), eliminating beneficial ownership information (BOI) reporting requirements for domestic U.S. companies.

The interim final rule reads:

“FinCEN is adopting this interim final rule to narrow the existing beneficial ownership information (BOI) reporting requirements under the Corporate Transparency Act (CTA) to require only entities previously defined as ‘foreign reporting companies’ to report BOI. Under this interim final rule, entities previously defined as ‘domestic reporting companies’ are exempted from the reporting requirements and do not have to report BOI to FinCEN, or update or correct BOI previously reported to FinCEN.”

This change follows Treasury Secretary Scott Bessent’s earlier announcement that the department would cease enforcement of these requirements for U.S. businesses amid multiple legal challenges resulting in inconsistent judicial outcomes across jurisdictions.

The latest regulatory rollback was driven in part by the substantial economic implications of the original reporting requirements. FinCEN had previously projected that approximately 33 million small businesses would have faced compliance obligations, generating an estimated $21.7 billion in total compliance costs during the first year of implementation and $3.3 billion annually thereafter.

According to the Treasury Department, this reassessment was prompted by an executive order issued in January directing agencies to “alleviate unnecessary regulatory burdens.” The department concluded that foreign reporting companies presented greater “national security and illicit finance risks” than their domestic counterparts.

For guidance on how the latest CTA changes may affect your business operations here and abroad, please contact your professional accounting or legal services provider. 

Questions?

More information is available on the FinCEN website here: https://www.fincen.gov/boi/ifr-qa.

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