New York Elder Law Attorney
In a dramatic policy reversal, the U.S. Treasury has permanently suspended the Corporate Transparency Act (CTA) beneficial ownership reporting requirements for all U.S. citizens and domestic businesses. This decision significantly shifts corporate compliance regulations, impacting businesses nationwide.
The CTA, enacted to enhance financial transparency and combat illicit finance, required most U.S. entities to report their beneficial ownership to a national registry managed by the Financial Crimes Enforcement Network (FinCEN).
- New entities (established since January 1, 2024) had to file within weeks of formation.
- Existing entities were required to submit reports by January 1, 2025.
However, multiple lawsuits challenged the Act on constitutional grounds, leading to legal uncertainty and enforcement delays throughout 2024. In December 2024, a Texas court issued an injunction against the enforcement of the CTA. Several reversals and reinstatements of the reporting provisions followed this. By February 2025, the compliance deadline was pushed to March 21, 2025, while the Treasury signaled a potential reconsideration of the rules.
The U.S. Treasury has permanently stopped enforcing CTA reporting obligations for U.S. entities. This means no penalties or fines will be imposed on domestic businesses or their beneficial owners—not now or in the future. The Treasury plans to revise the rule to focus only on foreign-owned entities. A public consultation will be held before new regulations take effect.
Treasury Secretary Scott Bessent described the decision as supporting American taxpayers and small businesses, ensuring financial regulations remain practical and non-burdensome. He framed the decision as part of President Trump’s broader agenda to eliminate excessive regulatory hurdles for businesses.
The Financial Action Task Force (FATF), which last year deemed the U.S. “largely compliant” with corporate transparency rules due to the CTA, may reassess the country’s standing following this policy reversal.
While the future shape of beneficial ownership regulations remains uncertain, one thing is clear: U.S. businesses will no longer need to comply with the CTA’s reporting requirements. Those preparing for compliance can now put those plans on hold until further guidance emerges.
Stay tuned for updates as the Treasury progresses with its proposed rulemaking process.