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The Corporate Transparency Act
Task Force

Resources & Insights

What You Need to Know

The Corporate Transparency Act
Task Force

Resources & Insights

What You Need to Know

FAQs
Key Contacts
Resources
Insights & News

On September 30, 2022, the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) published a highly anticipated rule (the BOI Reporting Rule) that implements the ultimate beneficial ownership information (BOI) reporting requirements of the Corporate Transparency Act (the CTA).

The CTA, which is part of the Anti-Money Laundering Act of 2020 (the AML Act) and enacted into law as a part of the National Defense Authorization Act for Fiscal Year 2021, established BOI reporting requirements for the vast majority of privately held corporations, limited liability companies and other similar entities created in, or registered to do business in, any of the states in the United States (U.S.), including the District of Columbia, Puerto Rico and other U.S. territories (collectively, Reporting Companies). 

The BOI Reporting Rule became effective on January 1, 2024, and that day, FinCEN began accepting beneficial ownership information reports. The CTA and BOI Reporting Rule were challenged immediately, with various courts across the country taking conflicting views on their legality. 

In February 2025, FinCEN announced that it would not issue any fines or penalties or take any other enforcement actions against any companies based on any failure to file or update BOI reports pursuant to the CTA by the then-current deadlines. A month later, the U.S. Department of the Treasury took FinCEN’s announcement a step further, stating that it would not issue fines or penalties associated with the BOI Reporting Rule until an amended BOI Reporting Rule took effect.

On March 26, 2025, FinCEN published the amended BOI Reporting Rule (the Interim Final Rule), revising the definition of “Reporting Company” to exclude all entities created in the U.S. and their beneficial owners from the BOI Reporting Rule. 

Frequently Asked Questions

The following deadlines now apply to foreign entities that are non-exempt “Reporting Companies”:

  • Reporting Companies registered to do business in the U.S. before March 26, 2025, must file BOI reports no later than April 25, 2025.
  • Reporting Companies registered to do business in the U.S. on or after March 26, 2025, must file BOI reports no later than 30 calendar days after receiving notice that their registration is effective.

Each Reporting Company must identify its “beneficial owners” by providing their:

    • full legal name;
    • date of birth;
    • current residential street address; and
    • unique identifying number and the issuing jurisdiction from (i) a non-expired passport; (ii) non-expired identification document issued by a State, local government, or Indian tribe; or (iii) non-expired U.S. driver’s license; or
    • in lieu of all the above, a “FinCEN identifier” – a unique identifying number assigned by FinCEN to an individual.

Additionally, for all new companies registered to do business in the United States on or after January 1, 2024, this information must be reported for each “Company Applicant,” which is the individual who (i) registers or files an application to register a foreign company to do business in the United States, and (ii) who is “primarily responsible for directing or controlling” such filing if more than one individual is involved in the filing of the document.

The BOI Reporting Rule defines a “beneficial owner,” with respect to a Reporting Company, as any non-U.S. individual (i.e., one or more) who, directly or indirectly, through any contract, arrangement, understanding, relationship or otherwise:

    • owns or controls at least 25% of the ownership interests of such Reporting Company; or
    • exercises “substantial control” over the Reporting Company.

An individual exercises “substantial control” over a Reporting Company if the individual:

    • serves a senior officer of the Reporting Company (e.g., president, CEO, COO, CFO, general counsel and any other officer who performs a similar function regardless of title);
    • has authority over the appointment or removal of any senior officer or a majority of the board of directors (or similar body); or
    • directs, determines, or has substantial influence over important decisions made by the Reporting Company (i.e., sale or other transfer of principal assets, reorganization, dissolution, merger, major expenditures or investments, issuances of any equity, incurrence of any significant debt, approval of the operating budget, selection or termination of business lines or ventures or geographic focus, compensation schemes and incentive programs for senior officers, entering into or terminating significant contracts, or amendments of any substantial governance documents).

The BOI Reporting Rule exempts from the definition of “beneficial owner” the following:

    • a minor child, as defined under the law of the State or Indian tribe in which a Reporting Company is first registered, provided the Reporting Company reports the required information of a parent or legal guardian of the minor child;
    • an individual acting as a nominee, intermediary, custodian, or agent on behalf of another individual;
    • an employee of a Reporting Company, acting solely as an employee, whose substantial control over or economic benefits from such entity are derived solely from the employment status of the employee, provided that such person is not a senior officer of the Reporting Company;
    • An individual whose only interest in a Reporting Company is a future interest through a right of inheritance; and
    • a creditor of a Reporting Company if the creditor satisfies the definition of “beneficial owner” solely through rights or interests for the payment of a predetermined sum of money, such as a debt incurred by the Reporting Company, or a loan covenant or other similar right associated with such right to receive payment that is intended to secure the right to receive payment or enhance the likelihood of repayment.

The BOI Reporting Rule imposes BOI reporting requirements on Reporting Companies.

“Reporting Company” is defined as a corporation, limited liability company, or other entity that is formed under the law of a foreign country and registered to do business in any State or tribal jurisdiction by the filing of a document with a secretary of state or any similar office under the law of a State or Indian tribe.

“State” is defined as any state of the U.S., the District of Columbia, the Commonwealth of Puerto Rico, the Commonwealth of Northern Mariana Islands, American Samoa, Guam, the U.S. Virgin Islands, and any other commonwealth, territory, or possession of the United States.

There are 23 types of entities that are exempt from reporting requirements.

The CTA identifies BOI collected pursuant to the CTA as confidential, subject to disclosure only in limited circumstances.

BOI reports submitted to FinCEN will be stored and maintained solely with FinCEN and will not be made publicly available nor made generally available to the States.

The CTA expressly provides that BOI collected by FinCEN may only be used for:

    • Facilitating national security, intelligence, and law enforcement activities; and
    • Confirming BOI provided to financial institutions to facilitate AML compliance, with the consent of the Reporting Company.

The CTA requires FinCEN to maintain BOI in a secure, nonpublic database, using information security methods and techniques appropriate to protect non-classified information systems at the highest security level; and to take all steps (including auditing) to ensure that government authorities access the information only for authorized purposes consistent with the CTA. FinCEN has developed the Beneficial Ownership Secure System (BOSS) to receive, store, and maintain BOI.

The CTA provides for civil and criminal penalties. Specifically, persons who:

    • willfully provide, or attempt to provide, false or fraudulent BOI, including a false or fraudulent identifying photograph or document to FinCEN; or
    • willfully fail to report complete or updated BOI to FinCEN;
    • will be subject to civil fines of no more than $500 for each day the violation continues and may be fined up to $10,000 and/or imprisoned for up to 2 years.

Additionally, any person who knowingly discloses or knowingly uses the BOI obtained by the person through either a report submitted to FinCEN or a disclosure made by FinCEN pursuant to the CTA, shall be liable for fines of up to $500 each day the violation continues and may be fined up to $250,000 and/or imprisoned for not more than 5 years; or if while violating another U.S. law or as part of a pattern of any illegal activity involving more than $100,000 in a 12-month period, such person may be fined up to $500,000 and/or imprisoned for up to 10 years.

Further, there is no indication in the language of the CTA that the federal government will consider any actions taken by a non-complying Reporting Company to be null and void based on the Reporting Company’s non-compliance with the CTA. Thus, the failure to comply with reporting requirements will not vitiate the formation of the applicable entity or prohibit a non-complying Reporting Company from conducting business or commencing action in federal court.

Key Contacts

Key Contacts

Carl Fornaris

Partner

Miami

Email

+1 305-910-0626

Cari Stinebower

Partner

Washington, DC

Email

+1 202-282-5788

Monica Lopez-Rodriguez

Of Counsel

Miami

Email

+1 305-910-0501

Dainia Jabaji

Of Counsel

Washington, DC

Email

+1 202-282-5035

Ryan Greenberg

Associate

Houston

Email

+1 713-324-7480

Carl Fornaris

Cari Stinebower

Monica Lopez-Rodriguez

Dainia Jabaji

Ryan Greenberg

Resources

FinCen: Beneficial Ownership Information Reporting FAQs
(Updated March 26, 2025)

FinCen: Corporate Transparency Act
Federal Register: Beneficial Ownership Information Reporting Requirements
FinCEN Hosts Webinar on Beneficial Ownership Information Reporting Requirements

FinCen: Beneficial Ownership Information Reporting FAQs
(Updated March 26, 2025)

FinCen: Corporate Transparency Act
Federal Register: Beneficial Ownership Information Reporting Requirements
FinCEN Hosts Webinar on Beneficial Ownership Information Reporting Requirements
Client AlertFinCEN Issues Interim Final Rule, Bringing an End to the Corporate Transparency Act as We Know It

On March 21, 2025, FinCEN issued another announcement and formally published the Interim Final Rule, revising the scope of beneficial ownership reporting to exclude domestic entities & U.S. persons, while setting new filing deadlines for entities previously known as “foreign reporting companies.”

Read More
Client AlertFinCEN Issues Interim Final Rule, Bringing an End to the Corporate Transparency Act as We Know It

On March 21, 2025, FinCEN issued another announcement and formally published the Interim Final Rule, revising the scope of beneficial ownership reporting to exclude domestic entities & U.S. persons, while setting new filing deadlines for entities previously known as “foreign reporting companies.”

Read More

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