The Treasury Department permanently eliminated corporate ownership reporting requirements that applied to an estimated 32 million small businesses, the agency announced Aug. 10. The Financial Crimes Enforcement Network, a Treasury bureau, said it is permanently terminating the Corporate Transparency Act’s beneficial ownership information reporting requirements.
The rule had required businesses to disclose their true owners to the federal government as part of an effort to combat money laundering and shell-company fraud.
The decision to permanently end the program, rather than extend a prior suspension, marks a definitive regulatory rollback. The BOI requirement had faced widespread legal challenges and bipartisan congressional opposition since enforcement began in 2024.
For small-business owners across the country, the action removes a federal filing obligation that carried potential civil and criminal penalties for noncompliance. Many small businesses had struggled with the requirement’s complexity, particularly sole proprietors and family-owned firms without dedicated compliance staff.
The Corporate Transparency Act was enacted with bipartisan support in 2021 as part of the National Defense Authorization Act. Proponents argued that requiring ownership disclosure would help law enforcement identify shell companies used for money laundering, fraud, and terrorist financing.
Critics, including small-business advocacy groups, countered that the rule imposed disproportionate burdens on legitimate businesses while doing little to deter sophisticated criminal actors who could evade the requirements.
FinCEN had previously suspended enforcement of the reporting requirements amid legal challenges, including a federal court ruling that questioned the constitutionality of applying the mandate to millions of small firms. The permanent termination announced Monday resolves the regulatory uncertainty that had lingered during the suspension period.
Treasury did not indicate whether alternative anti-money-laundering measures targeting shell companies would replace the BOI framework.