Corporate Transparency Act Update | File Your BOI
CTA UPDATE
The interim final rule was release March 21, 2025. Below is a summary.
According to the findings of a Financial Action Task Force’s Report on the Concealment of Beneficial Ownership, foreign companies registered to do business in the U.S. pose a heightened risk to U.S. national security. Because of this data, the required scope has been narrowed for the Corporate Transparency Act’s (CTA’s) Beneficial Ownership Information (BOI) reporting requirements to foreign entities and foreign nationals. The new rule includes the following:
“Reporting Company” has been redefined to include only entities formed under the law of a foreign country that has registered to do business in any U.S. State or Tribal Jurisdiction. Entities created in the United States — including those previously known as “domestic reporting companies” — and their beneficial owners will be exempt from the requirement to report BOI to FinCEN.
The Reporting Company now only has to report the BOI of foreign nationals, but not U.S. beneficial owners.
For those foreign pooled investment vehicles where no non-U.S. person exercises substantial control, a beneficial ownership report is not required.
Deadlines
BOI reports are due for foreign entities registered to do business in the US 30 days after publication of the Final Rule.
Newly registered foreign entities must file within 30 days after receiving notice that their registration is effective.
Last time …
As of March 3, 2025: FinCEN announced that it will not enforce actions against any companies, including fines and penalties, that do not file or update BOI reports by the March 21 deadline.
While we cannot promise this will be the last update (unless or until 31 U.S.C. 5336 is repealed or amended by Congress, it is still a federal law.), we can share the Treasury’s March 2, 2025 press release:
The Treasury Department is announcing today that, with respect to the Corporate Transparency Act, not only will it not enforce any penalties or fines associated with the beneficial ownership information reporting rule under the existing regulatory deadlines, but it will further not enforce any penalties or fines against U.S. citizens or domestic reporting companies or their beneficial owners after the forthcoming rule changes take effect either. The Treasury Department will further be issuing a proposed rulemaking that will narrow the scope of the rule to foreign reporting companies only. Treasury takes this step in the interest of supporting hard-working American taxpayers and small businesses and ensuring that the rule is appropriately tailored to advance the public interest.
In addition to the press release issued by Treasury, a Federal judge in Grand Rapids recently struck down the CTA as unconstitutional. Both events seem to be evidence that the CTA is headed towards its demise, but thus far there never appear to be enough nails to keep the coffin shut on the CTA.
Previously …
Under the Corporate Transparency Act (CTA), reporting entities are, once again, required to file their Beneficial Ownership Information (BOI) by March 21, 2025.
On February 17, a federal judge revoked the stay he had issued on January 7, in Smith v. U.S. Department of the Treasury, 6:24-cv-00336 (E.D. Tex.), which had previously blocked the Government from enforcing the BOI Rule nationwide.
The next day, on February 18, the U.S. Treasury’s Financial Crimes Enforcement Network (FinCEN) announced the new deadline for submitting an initial, updated, or corrected BOI report to FinCEN: March 21, 2025.
What this means for you
Currently, any entity, including those formed before January 1, 2024, is required to report by March 21, 2025.
If FinCEN makes further changes, such as modifying the deadlines for entities that do not pose significant security risks or revising the BOI reporting rule, we will keep you informed.
Need to refresh your memory about this CTA saga? Check our our other blog post.
The CTA situation is continually evolving and our firm will continue to provide updates as they become available. If you require assistance with the process of compliance with the CTA, please Connect with Us.