The Current Status of the Corporate Transparency Act: An Overview

The Corporate Transparency Act (CTA) has been a hot topic among business owners since it was passed by Congress on January 1, 2021, as part of the Anti-Money Laundering Act. Designed to increase corporate transparency and combat financial crimes like money laundering, corruption, and tax fraud, the CTA introduces new reporting requirements for certain business entities in the United States. In March 2025, the U.S. Treasury Department made a major announcement about CTA reporting requirements against U.S. citizens and domestic companies. Learn what this change means for your business and what steps you should take next.

Crystal Earp

4/27/20251 min read

Corporate Transparency Act Update:

Major Changes Announced in 2025

The Corporate Transparency Act (CTA), which went into effect on January 1, 2024, initially created sweeping new reporting obligations for U.S. businesses. However, a major announcement from the U.S. Department of the Treasury in March 2025 has dramatically changed the compliance landscape.

Here's what business owners and compliance professionals need to know.

A Quick Refresher: What is the Corporate Transparency Act?

The CTA was originally intended to require all corporations, LLCs, and similar entities to file Beneficial Ownership Information (BOI) reports with the Financial Crimes Enforcement Network (FinCEN), identifying individuals who own or control companies. The goal was to prevent illicit activities like money laundering and terrorism financing.

Entities formed before January 1, 2024, were required to file by January 1, 2025, and new entities were required to file within a set number of days after formation.

March 2025 Update:

Suspension of Enforcement for U.S. Citizens and Domestic Companies

On March 2, 2025, the Treasury Department announced that it will:

No longer enforce any penalties or fines related to BOI reporting against U.S. citizens, domestic reporting companies, or their beneficial owners — under the current rules or under future rule changes.
Propose a rule change that will narrow the CTA’s scope to foreign reporting companies only.
Support small businesses by significantly scaling back the original requirements in favor of a more targeted approach aimed at foreign entities.

Key Takeaways

If you are a U.S. citizen or a domestic entity (such as a corporation or LLC formed under U.S. state law), you no longer have an obligation to file a BOI report under the Corporate Transparency Act.
If you are a foreign reporting company (organized under foreign law but registered to do business in the U.S.), you will still be required to comply once the new rule is finalized.
No penalties or fines will be assessed against U.S. citizens and domestic companies for missing deadlines under the existing rules or under the future rules.