Small Businesses Win Relief From Corporate Transparency Act Reporting
Key Highlights
- The finalized rule exempts U.S. companies and persons from beneficial ownership reporting requirements established under the CTA.
- FinCEN will delete previously submitted beneficial ownership information related to U.S. entities from federal databases.
- The change is expected to generate $9 billion in annual compliance savings and impact around 15 million entities.
ITASCA, Illinois — The U.S. Department of the Treasury has finalized changes to beneficial ownership information (BOI) reporting requirements that permanently exempt U.S. companies and U.S. persons from the requirements.
The Financial Crimes Enforcement Network (FinCEN) finalized the rule Aug. 11, with the changes taking effect Aug. 14. The rule also directs FinCEN to delete previously submitted BOI associated with U.S. persons from the federal BOI database.
The changes stem from reporting requirements established under the Corporate Transparency Act (CTA), which Congress enacted in 2021 as part of the National Defense Authorization Act. The requirements took effect in 2024 and initially applied to tens of millions of U.S. businesses.
Under the original requirements, covered companies had to report identifying information about their owners and controlling individuals to FinCEN.
After legal challenges and advocacy from the small-business community, Treasury temporarily exempted U.S. companies and U.S. persons from the requirements in March 2025. The finalized rule makes that relief permanent.
FinCEN estimates the revised rule will generate $9 billion in annual compliance savings.
The agency also plans to purge previously collected BOI associated with U.S. owners and entities. According to the announcement, the action will affect an estimated 15 million entities and tens of millions of individuals.
The American Supply Association (ASA) and the S-Corp Association have advocated for changes to the BOI requirements, citing compliance costs and privacy concerns for small and family-owned businesses.
“This is a significant win for Main Street businesses, but our work is not finished,” said ASA Vice President of Advocacy Steve Rossi. He said ASA will continue working with coalition partners toward a permanent solution that protects small and family-owned businesses from unnecessary paperwork, compliance costs and privacy risks.
The revised rule provides permanent reporting relief for U.S. companies and U.S. persons, but the underlying Corporate Transparency Act remains in place. According to ASA, the organization plans to continue advocating for a permanent legislative solution.