The Corporate Transparency Act – Interim Final Rules by Treasury

When we last looked in on the ongoing saga of the Corporate Transparency Act (CTA) and its Beneficial Ownership Information (BOI) reporting requirement enforced by the Financial Crimes Enforcement Network (FinCEN), the Treasury Department had issued a press release which appeared to do away with the BOI reporting requirement, except for foreign reporting companies.

In that press release, issued on March 2, 2025, the Treasury Department said it would “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.”

On Friday, March 21, the Treasury Department issued interim final regulations limiting the BOI reporting requirement to foreign beneficial owners of foreign companies registered in the U.S.  Those interim final regulations can be found here:

FinCEN 31 CFR Part 1010.380, RIN 1506-AB49

An email sent by “FinCEN Guidance” on Monday, March 24, describes the effect of the interim final regulations as follows [emphasis in original]:

U.S. Companies and U.S. Persons No Longer Required to Report.

• FinCEN’s new interim final rule eliminates BOI reporting requirements for all entities formed in the United States (previously called “domestic reporting companies”).
• U.S. persons (individuals) are no longer required to report BOI, even if they are beneficial owners of foreign companies doing business in the U.S.
• This represents a full exemption from CTA reporting obligations for U.S.-based entities and individuals.

Only Foreign Companies Now Covered

• The revised definition of a “reporting company” now includes only foreign companies that:
  • Were formed under the laws of a foreign country, and
  • Have registered to do business in the U.S. by filing with a secretary of state or similar office.
  • Even these foreign companies do not have to report any U.S. beneficial owners.

New Deadlines for Foreign Companies

• If registered before March 21, 2025: BOI reports are due by April 20, 2025
• If registered on or after March 21, 2025: Must file within 30 calendar days of effective registration.

Final Rule to be Issued Later this Year

• This interim rule is effective immediately.
• FinCEN will accept public comments and intends to issue a final rule later this year, but significant changes to this policy are not expected.
• Domestic entity (e.g., U.S. LLC or corporation) – No BOI reporting required, even if owned by foreign persons.
• Foreign entity registered to do business in the U.S. – Must report, but only if not exempt and only foreign beneficial owners need to be disclosed.

Bottom Line:  The Treasury Department has followed through on issuing (interim) final regulations limiting the BOI reporting requirement to foreign companies, and only with regard to foreign beneficial owners.  These emasculated rules seem to run counter to the original intent of the CTA, which was passed by Congress in 2020.  Therefore this may not be the end of the saga.  As one commentator observed, “legal action challenging the narrowed rule may come from members of Congress, pro-transparency groups, states, or law enforcement. . . . Because the law [CTA] is still on the books, another administration could withdraw the recent rule and make the reporting requirements more strict again.”