On March 2, 2025, the U.S. Treasury Department announced that it will not enforce any fines or penalties associated with the existing March 21, 2025 beneficial ownership information filing deadline under the Corporate Transparency Act (CTA). Additionally, it announced that after a forthcoming rule change is effective, it will not enforce any penalties against domestic reporting companies, its beneficial owners, or U.S. citizens. 

What Changed?

Originally, the CTA required many U.S. businesses to report their beneficial ownership information to the Financial Crimes Enforcement Network (FinCEN) to help prevent money laundering and other financial crimes.  However, the Treasury has now announced that it is working on a rule change that would limit the CTA’s filing requirements to foreign reporting companies only—not domestic businesses. Additionally, FinCEN recently announced that it intends to issue an interim final rule as soon as possible, and no later than March 21, 2025, which will extend the current submission deadline and clarify who is required to file. 

Who Are Foreign Reporting Companies?

Under the CTA, these are entities formed under the laws of a foreign country that have registered to do business in the U.S. by filing with a secretary of state or a similar government office.

Why the Change?

This shift follows a legal battle that included a decision from the Eastern District of Texas (Smith v. U.S. Department of the Treasury, Feb. 17, 2025), which lifted the last remaining nationwide injunction against the CTA’s enforcement. According to the FinCEN website, “this announcement continues Treasury’s commitment to reducing regulatory burden on businesses, as well as prioritizing under the Corporate Transparency Act reporting of BOI for those entities that pose the most significant law enforcement and national security risks.”

What Happens Next?

A few key things to keep in mind:

• The FinCEN interim final rule should be issued no later than March 21, 2025. 
• The Treasury’s proposed rule could face legal challenges since it conflicts with the CTA’s original text.
• Congress is reviewing possible changes to the law, so more adjustments could be coming.

What Should Businesses Do?

For now, it appears safe for domestic businesses to pause their CTA compliance efforts. However, because the legal landscape is still evolving, staying informed is critical. If your company operates internationally or has a complex structure, you may still be affected.

If you have any questions about how these changes impact your business, our team is here to help. Reach out to our office for the latest updates and guidance.