Treasury Dept. Says It Won’t Enforce CTA Against Certain Companies
On March 2, 2025, the U.S. Treasury Department (the “Treasury Department”) issued a press release announcing that, with respect to the Corporate Transparency Act (“CTA”), it will “not enforce any penalties or fines associated with the beneficial ownership information reporting rule under the existing regulatory deadlines.” Furthermore, the Treasury Department stated it will “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 noted that it anticipates the issuance of a proposed rulemaking to “narrow the scope of the rule to foreign reporting companies only.” To view this press release, please click here. FinCEN also posted a similar notice (click here).
The press release indicates that the CTA will not be enforced against U.S. citizens, domestic reporting companies, and domestic reporting companies’ beneficial owners. However, at the moment, the CTA law/rule is still in place. While we anticipate the rules surrounding CTA compliance to change, CTA compliance remains mandatory. It is no guarantee that the Treasury Department will issue such new rule. When deciding whether to file a Beneficial Ownership Information Report (“BOIR”) with FinCEN, Reporting Companies will need to balance (1) their desire for confidentiality; (2) the currently mandatory CTA compliance obligation; and (3) the likelihood that the Treasury Department issues this new rule.
What Does This Mean for Your Reporting Obligations?
Currently, the CTA law/rule is still in effect but, given the Treasury Department and FinCEN’s combined announcements that they will not be enforcing the rule “under the existing regulatory deadlines”, it appears they do not expect certain Reporting Companies to comply with the law/rule. At this time, Reporting Companies may deem it best to wait and not file a BOIR until the Treasury Department and/or FinCEN issues a new rule. That said, if you have a foreign Reporting Company, the rule and the current regulatory deadlines still apply to you, and you must file a BOIR with FinCEN.
In the ever-changing CTA landscape, we will continue to keep you updated with any developments.
To learn more about the Corporate Transparency Act, please contact Beresford Booth at info@beresfordlaw.com or by phone at (425) 776-4100.
