Treasury Suspends Enforcement of Corporate Transparency Act for U.S. Companies
The U.S. Treasury Department has announced a major shift in its approach to the Corporate Transparency Act (CTA)—a move that significantly reduces compliance burdens for U.S. businesses. In a statement on 2 March 2025, Treasury confirmed that it will not enforce penalties or fines for failing to meet the CTA’s beneficial ownership information (BOI) reporting requirements under the current regulatory deadlines.
More importantly, Treasury has taken this a step further by declaring that U.S. citizens, domestic reporting companies, and their beneficial owners will not face penalties or enforcement actions even after future rule changes take effect. Instead, a new rule will be proposed to limit BOI reporting requirements to foreign reporting companies only.
What This Means for U.S. Businesses
The CTA was originally designed to enhance corporate transparency by requiring businesses to disclose their beneficial owners to the Financial Crimes Enforcement Network (FinCEN). However, concerns have been raised about the administrative burden this placed on small businesses. Treasury’s decision to suspend enforcement aligns with the government’s broader efforts to ease regulatory pressure on American businesses and entrepreneurs.
“This is a victory for common sense,” said U.S. Treasury Secretary Scott Bessent. “Today’s action is part of President Trump’s bold agenda to unleash American prosperity by reining in burdensome regulations, in particular for small businesses that are the backbone of the American economy.”
What’s Next?
The Treasury Department plans to issue a proposed rule to formally narrow the scope of the CTA’s reporting requirements. Until then, U.S. businesses are not required to file BOI reports and will not face any penalties for non-compliance.
At SDA CPA, we will continue to monitor these developments and provide our clients with up-to-date guidance on regulatory changes that affect their businesses. If you have any questions about your compliance obligations, get in touch with our team today.
