Corporate Transparency Act – Enforcement Suspended Until Further Notice

The U.S. Treasury Department’s Financial Crimes Enforcement Network (“FinCEN”) announced that it will not issue any fines or penalties or otherwise take any enforcement actions based on any failure to file or update beneficial ownership information (“BOI”) reports under the Corporation Transparency Act (the “CTA”) by existing deadlines pending a planned revision to the applicable regulations. The Treasury Department then further announced that, even after the new regulations are in place, the Treasury Department will not enforce any penalties or fines against U.S. citizens, domestic reporting companies or the beneficial owners of domestic reporting companies.

On February 27, 2025, FinCEN gave public notice that it intends to issue an interim final rule (“IFR”) with respect to the CTA no later than March 21, 2025, and until the IFR becomes effective and the extended due dates set forth in the IFR have passed, it will not issue fines or penalties or take enforcement action against any person for failure to file or update BOI reports. FinCEN also indicated that it intends to solicit public comment on potential revisions to BOI reporting requirements to minimize burden on small businesses and modify deadlines while ensuring that BOI is highly useful to important national security, intelligence, and law enforcement activities.

Then, on March 2, 2025, the Treasury Department announced in a statement that, in addition to suspending all enforcement action pending forthcoming rule changes, it will continue to not enforce any penalties or fines associated with BOI reporting against U.S. citizens, “domestic reporting companies” or the beneficial owners of domestic reporting companies after the rule changes become effective. The Treasury Department will issue a proposed rule narrowing the scope of reporting obligations to “foreign reporting companies” only.

Pursuant to CTA regulations:

• A “domestic reporting company” is a corporation, limited liability company or any other entity created by the filing of a document with the secretary of state or any similar office under the law of a U.S. state or territory or an Indian tribe.
• A “foreign reporting company” is an entity (including a corporation or limited liability company) formed under the law of a foreign country that has registered to do business in the United States by the filing of a document with a secretary of state or any similar office of a U.S. state or territory or an Indian tribe.

Please review FinCEN’s BOI FAQs for more information on which companies constitute domestic or foreign reporting companies.

We anticipate that FinCEN’s promised IFR or the Treasury Department’s further proposed rulemaking will address in more detail how the CTA will be enforced or not enforced with respect to domestic reporting companies, foreign reporting companies and their respective beneficial owners.

Stoel Rives lawyers are available to assist in determining whether an entity is exempt and who its beneficial owners are for reporting purposes, but we will not be affirmatively advising clients with respect to the CTA unless specifically engaged to do so. We will also not be able to submit BOI reports on your behalf. Please reach out to your Stoel Rives contact if you have any questions or need assistance.