In an interim final rule (IFR) announced March 21, 2025, the Financial Crimes Enforcement Network (FinCEN) dramatically narrowed the scope of the Corporate Transparency Act (CTA). Under the IFR, which is effective immediately, only "foreign reporting companies" remain subject to the CTA’s reporting requirements for beneficial ownership information (BOI). All "domestic reporting companies," including those owned or controlled by foreign entities or individuals, are now "exempted from the reporting requirements and do not have to report BOI to FinCEN, or update or correct BOI previously reported to FinCEN," according to the IFR.
This new exemption represents a de facto repeal of the CTA on the part of the Trump administration. It removes from the CTA’s coverage nearly all of the entities to which it originally applied. The only entities still subject to the act are those formed under the laws of a foreign country and registered to do business in the United States by the filing of a document with a secretary of state or equivalent office. According to FinCEN’s earlier estimates, this category was expected to comprise less than 0.2% of the entities subject to the CTA’s original reporting requirements.
Moreover, the IFR "exempts foreign reporting companies from having to report the BOI of any U.S. persons who are beneficial owners of the foreign reporting company and exempts U.S. persons from having to provide such information to any foreign reporting company for which they are a beneficial owner."
Foreign reporting companies not otherwise exempt must file their BOI reports with FinCEN by April 25, 2025 (30 days after the March 26 publication date of the IFR) or, if later, 30 days after receipt of notice that it has been registered to do business in the U.S.
The IFR could be subject to court challenges as exceeding the authority of the executive branch. It is also possible that the current, or future, administration could reinstate some or all of the CTA’s original requirements through further rulemaking. But for now, the CTA is inapplicable to all entities organized in the U.S., and to any U.S. persons who are beneficial owners of foreign reporting companies.
You can read more about the CTA's "on again, off again" status by reading our previous client alert linked below:
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