Treasury Ends Beneficial Ownership Reporting for U.S. Companies
The U.S. Department of the Treasury has permanently ended federal beneficial ownership reporting requirements for U.S. companies, resolving a significant source of uncertainty for millions of small businesses.
On Aug. 11, the Treasury Department’s Financial Crimes Enforcement Network (FinCEN) issued a final rule removing the requirement for American companies to report beneficial ownership information under the Corporate Transparency Act (CTA). The rule took effect upon publication in the Federal Register. FinCEN also announced that it will delete previously reported information submitted by companies from its beneficial ownership information database.
“The final rule protects American small and independent businesses from this onerous reporting mandate and requires the destruction of previously submitted personal data,” said Brad Close, president of the National Federation of Independent Business. “But Congress needs to finish the fight. We look forward to working with the Trump administration to urge Congress to permanently repeal the invasive BOI law. We thank the Trump administration for its work on behalf of America’s small businesses.”
Congress enacted the CTA in 2021 as part of an effort to combat illicit financial activity, including money laundering and tax fraud. The law required companies to report information identifying the individuals who ultimately own or control them. The reporting requirements took effect in January 2024 and initially applied to an estimated 32 million businesses.
The requirements quickly became the subject of legal challenges. In 2024, a federal district court in Alabama ruled that Congress exceeded its constitutional authority in enacting the CTA because the law regulated noncommercial acts of incorporation, a local act that did not qualify as interstate commerce. In December 2025, however, the 11th U.S. Circuit Court of Appeals reversed that decision, finding that the law fell within Congress’ authority under the Commerce Clause because it regulates economic activity.
The conflicting legal developments created uncertainty for businesses about whether, when, and how they would need to comply. To ease the ambiguity, the Treasury Department announced in March 2025 that it would not enforce penalties or fines against U.S. citizens or domestic companies for failing to report beneficial ownership information. The policy change left reporting requirements in place for certain foreign companies.
The Aug. 11 final rule makes that exemption permanent. It also eliminates the requirement for foreign entities to report U.S. persons who served as “company applicants” — individuals who helped those companies register to do business in the United States. In addition, certain foreign pooled investment vehicles registered in the United States are exempt from reporting beneficial ownership information for U.S. persons who control the investment vehicle. FinCEN said it will delete information about any individual it reasonably believes is a U.S. person, including beneficial owners, company applicants, and individuals who obtained FinCEN identification numbers.
FEDA has been active in efforts to resolve the uncertainty surrounding the CTA and protect the privacy of businesses that had already submitted information. In January, FEDA joined other trade associations in asking the U.S. Treasury to purge beneficial ownership information submitted by domestic companies that were no longer required to file. At the time, approximately 16 million individuals and businesses had submitted information to FinCEN before Treasury suspended enforcement of the reporting requirements for U.S. companies. The groups argued that retaining the information served no legitimate government purpose and could create unnecessary privacy and security risks.
In May, FEDA and other business advocacy groups asked the U.S. Supreme Court to resolve the constitutional questions surrounding the CTA. In a letter to U.S. Attorney General Todd Blanche, the groups argued that continued uncertainty could result in repeated litigation, shifting compliance obligations, and confusion for businesses trying to determine their responsibilities under the law. The Supreme Court was considering whether to review cases involving challenges to the CTA, including questions about Congress’ authority under the Commerce Clause and the law’s compatibility with the Fourth Amendment.
The Treasury Department’s final rule now removes the reporting requirement for U.S. companies and U.S. persons without requiring the Supreme Court to resolve those questions. Along with publishing the final rule, FinCEN updated its frequently asked questions page and said it will continue updating its beneficial ownership guidance.