The U.S. Treasury Department announced Sunday a suspension of the enforcement of the Corporate Transparency Act (CTA) against U.S. citizens and domestic reporting companies. 

This will include suspension of any penalties or fines associated with the beneficial ownership information (BOI) rule under existing regulatory deadlines, a press release says. It also will not enforce any penalties or fines after a forthcoming rule change takes effect, it says. 

“The Treasury Department will further be issuing a proposed rulemaking that will narrow the scope of the rule to foreign reporting companies only,” the release says. “Treasury takes this step in the interest of supporting hard-working American taxpayers and small businesses and ensuring that the rule is appropriately tailored to advance the public interest.”

President Donald Trump called the news “exciting” on his Truth Social platform Sunday. 

“This Biden rule has been an absolute disaster for Small Businesses Nationwide,” Trump said in the post. “Furthermore, Treasury is now finalizing an Emergency Regulation to formally suspend this rule for American businesses. The economic menace of BOI reporting will soon be no more.”

Businesses were originally required to file a BOI corporate transparency report in January. However, multiple suits questioning the constitutionality of the CTA have pushed the deadline back, with the most recent deadline set for March 21. 

Businesses that missed the deadline faced up to two years of imprisonment, fines up to $10,000, and civil penalties of up to $591 per day.

The Treasury Department’s Financial Crimes Enforcement Network (FinCEN) also announced last week that it would not take enforcement actions pursuant to the CTA. 

FinCEN says in a release that it intends to issue an interim final rule that extends BOI reporting deadlines by March 21. 

“FinCEN also intends to solicit public comment on potential revisions to existing BOI reporting requirements,” the release says. “FinCEN will consider those comments as part of a notice of proposed rulemaking anticipated to be issued later this year to minimize burden on small businesses while ensuring that BOI is highly useful to important national security, intelligence, and law enforcement activities, as well to determine what, if any, modifications to the deadlines referenced here should be considered.”

There have been multiple attempts to stall the CTA by different groups since it was enacted in 2021. 

Hundreds of small businesses, including the Society of Collision Repair Specialists (SCRS), National Small Business Association, and S Corporation Association asked for the passage of different bills, such as S3625 and its companion HR5119, that would have stalled legislation; however, none of the bills have made it through Congress.

A letter sent to Congress in March 2024 says the CTA specifically burdens the smallest of businesses with reporting requirements by applying only to entities with 20 or fewer employees or less than $5 million in revenue. 

Most recently, more than 40 members of Congress sent a letter to FinCEN requesting a one-year delay on the CTA. 

“This is a victory for common sense,” said U.S. Secretary of the Treasury Scott Bessent in the Sunday release.  “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.”

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