NEWS: The rule for companies to report beneficial ownership information (BOI) to the Financial Crimes Enforcement Network (FinCEN) was back on in February 2025, as you may recall from this Compliance Courier. At that time, for the vast majority of reporting companies, the deadline to file an initial, updated, and/or corrected BOI report was March 21, 2025.
However, on March 21, FinCEN issued an interim final rule that removes the requirement for U.S. companies and U.S. persons to report BOI to FinCEN under the Corporate Transparency Act (CTA). The rule narrows the BOI reporting requirements to require only entities previously defined as “foreign reporting companies” to report BOI. Entities previously defined as “domestic reporting companies” (corporations, limited liability companies, or other entities created by the filing of a document with a secretary of state or similar office) are now exempt and do not have to report BOI to FinCEN, or update or correct BOI previously reported to FinCEN.
Thus, through this interim final rule, all entities created in the United States — including those previously known as “domestic reporting companies” — and their beneficial owners will be exempt from the requirement to report BOI to FinCEN. Foreign entities that meet the new definition of a “reporting company” and do not qualify for an exemption from the reporting requirements must report their BOI to FinCEN under new deadlines, detailed below. These foreign entities, however, will not be required to report any U.S. persons as beneficial owners, and U.S. persons will not be required to report BOI with respect to any such entity for which they are a beneficial owner.
FinCEN justifies these amendments by citing the CTA’s mandate to the U.S. Treasury Secretary to “minimize burdens on reporting companies” and the Secretary’s authority to exempt certain entities from reporting. Although the Interim Final Rule acknowledges that the failure to require BOI reporting by domestic entities could pose illicit finance risks, the rule mentions that alternative sources of information, such as “the continuing requirement for covered financial institutions to collect a legal entity customer’s BOI at the time of account opening will serve to mitigate certain illicit finance risks associated with exempting domestic reporting companies from reporting their BOI.”
As we explain in The League’s ii Release No. 0159, existing Customer Due Diligence (CDD) rules require credit unions and other financial institutions to gather information about those who own or control the “legal entities” that open accounts, such as corporations and LLCs. That requirement is not changing. The new interim final rule only impacts rules that would have required most companies to report their BOI information directly to FinCEN.
The exemption for domestic reporting companies provided in this interim final rule serves to suspend any reporting requirements within this statutorily authorized period while the rule is finalized during that period. FinCEN is currently accepting comments on this interim final rule and intends to finalize the rule this year.