New Developments in the CTA: FinCEN and the U.S. Department of the Treasury Offer Temporary Compliance Relief

On February 27, 2025, the Financial Crimes Enforcement Network (FinCEN) announced that it will not impose fines, penalties, or enforcement actions against any companies for failing to file or update beneficial ownership information (BOI) reports required under the Corporate Transparency Act (CTA) by the current deadline of March 21, 2025. Instead, FinCEN plans to issue an interim final rule on or prior to the deadline.  We anticipate the interim rule will establish new reporting deadlines and potentially revise reporting requirements.

Consistent with the continued chaos surrounding the CTA, just a few days later, on March 2, 2025, the U.S. Department of the Treasury separately announced that it will not enforce any penalties or fines against U.S. citizens, domestic reporting companies, or their beneficial owners—not only for missing the current deadline but also for failing to comply once the new rule takes effect.  Furthermore, the Department of Treasury revealed plans to issue a proposed rulemaking that will only impose the CTA’s reporting requirements on foreign reporting companies (i.e., U.S. reporting companies will no longer be required to report).  The latest action is notable, as FinCEN is a bureau within the Department of Treasury, and the Director of FinCEN is appointed by such Department.  Even if the Department of Treasury does not enforce the CTA, Congress has taken no action to repeal the CTA, and it remains law.  There is, however, a House-passed bill that could delay, but not eliminate, CTA deadlines and obligations.

We also understand that various states (e.g., New York) have passed statewide versions of the CTA, and other states are considering implementing their own versions, as well.  Of course, such state actions have resulted in the filing of various lawsuits.   

Now that FinCEN’s “boss” is involved, it is possible, yet unlikely, that U.S. citizens and domestic companies will be free from the requirements of the CTA.  We continue to recommend that affected entities prepare and gather the necessary information for BOI reports, as the situation remains in flux and further changes are likely to occur.

This is a developing situation, and we expect to provide further updates as new announcements and rules emerge. The contents of this Client Alert are for informational purposes only and do not constitute legal advice. If you have any questions or would like to discuss your CTA compliance obligations, please contact a Baird Holm attorney.

For historical background on the CTA, please refer to our previously published articles:

• The Corporate Transparency Act – What You Need to Know Now (January 3, 2024)
• Your Health Care Organization Could Be Subject to the Corporate Transparency Act (CTA) (February 29, 2024)
• What is Happening with the Corporate Transparency ACT (CTA)? (December 5, 2024)
• Well, That was Quick – The Corporate Transparency Act is Back: Appellate Court Lifts Nationwide Injunction (December 23, 2024)
• Update: CTA Filing Extended to January 13, 2025 for Entities Formed Prior to 2024 (December 24, 2024)
• Hold Your Horses, 5th Circuit… Let’s Figure Out What’s Happening with the Corporate Transparency Act (December 27, 2024).
• Did the January 23rd U.S. Supreme Court Stay Change Your Filing Obligations with the Corporate Transparency Act? (January 24, 2025)
• File Your CTA Beneficial Ownership Report with FinCEN on or prior to March 21, 2025 (February 20, 2025)