Corporate Transparency Act Update - FinCEN Permanently Ends Beneficial Ownership Reporting Requirements for Millions of Small Business Owners
Updated Notice
The U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) is issuing a final rule that permanently removes the requirement for U.S. companies and U.S. persons to report beneficial ownership information to FinCEN under the Corporate Transparency Act. The final rule is effective on its publication in the Federal Register. FinCEN today also announced that it will delete previously reported information by U.S. persons—now exempt from the reporting requirements—from the beneficial ownership information database.
THE FINAL RULE:
- adopts the exemptions set out in the interim final rule issued in March 2025, making the rollback of beneficial ownership reporting by U.S. companies permanent;
- exempts U.S. persons who have obtained FinCEN IDs from any obligation to update or correct the information they originally provided to FinCEN to obtain their FinCEN IDs;
- eliminates the requirement for foreign companies to report U.S. person “company applicants” (i.e., the individuals who helped those foreign companies register to do business in the United States);
- exempts foreign pooled investment vehicles registered in the United States from reporting the beneficial ownership information of a U.S person in control of the investment vehicle; and
- confirms that FinCEN will delete information about any individuals—company applicants, beneficial owners, or recipients of a FinCEN ID—that FinCEN reasonably believes is a U.S. person (e.g., the information is linked to a U.S. passport or U.S. driver’s license).
Current Steps
Under the final rule, foreign entities that are reporting companies will still be required to report beneficial ownership information for foreign individuals.
Kemp Klein will continue to monitor developments affecting foreign reporting companies under the CTA. Separate state reporting requirements may also apply. New York, for example, has enacted its own beneficial ownership disclosure requirements for certain LLCs formed outside the United States and authorized to do business in New York, while other states have considered similar legislation. An entity’s formation or registration to do business in a particular state may therefore create additional reporting obligations.
For More Information
Disclaimer
This page does not constitute legal advice or providing legal services. This page is merely a general announcement of a new regulation. Nothing contained within this page constitutes a lawyer client relationship between Kemp Klein Law Firm and the reader. The implementation of the Corporate Transparency Act is still in development. Further, a variety of other federal and state laws and regulations may apply to your particular business activities. You may contact your legal counsel if you have specific questions.
For further information on these developments and their impact on the CTA click here. Make sure to check out the Legislative Updates section of kkue.com for Important Information and insight on major new legal developments.
Please contact your Kemp Klein Law Firm Attorney or email us at CTAGuidance@kempklein.com if you have any additional questions regarding your company’s reporting obligations or to discuss the process of compliance. Standard Billing Rates will apply.
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