Corporate Transparency Act: FinCEN Update on Enforcement and Reporting Requirements

ALBANY, NY | On February 27, 2025, the Financial Crimes Enforcement Network (FinCEN) announced that it will not be issuing penalties, fines, or taking other enforcement actions against any reporting companies for failure to file or update Beneficial Ownership Information (BOI) reports under the current Corporate Transparency Act (CTA) guidelines, including the March 21, 2025 deadline that was previously established.

What You Need to Know About the Enforcement Status

Despite the lack of enforcement at this time, the CTA remains effective law. FinCEN has confirmed that no penalties or enforcement actions will be pursued against companies that fail to meet their filing or update obligations until further notice. This delay gives businesses more time to get in compliance without facing the usual penalties.

Upcoming Interim Final Rule

No later than March 21, 2025, FinCEN is set to issue an interim final rule that will extend BOI reporting deadlines and provide additional clarity about the filing process. This rule is expected to address existing uncertainties regarding the reporting obligations for businesses and help streamline the compliance process.

Potential Impact on Foreign Reporting Companies

A press release from the U.S. Department of the Treasury revealed that FinCEN is considering a proposal that would limit the applicability of the CTA to foreign reporting companies. These are entities formed under foreign laws but registered to do business in the U.S. The proposed changes could affect how foreign companies handle their compliance with the CTA.

Recommendations Moving Forward

Given the volatility of the CTA’s status over the past few months, businesses should closely monitor the situation. Although penalties are not currently being enforced, it could still be beneficial to have all the necessary information prepared for filing in case the enforcement regime is reinstated. While there is no immediate need to report, having the information on hand will help your company stay ahead when the filing deadlines and enforcement actions resume.

For more information, visit: https://www.fincen.gov/boi

New York Companies, Be Aware: Separate Filing Requirement Under NY-LLCTA

The New York LLC Transparency Act (NYTA), effective January 1, 2026, requires LLCs formed or authorized to do business in New York to file a Beneficial Ownership Information Report. Existing LLCs must file by January 1, 2027, while new LLCs have 30 days to comply. Exempt LLCs must file an attestation and are subject to annual reporting. Noncompliance could lead to daily fines or potential dissolution after two years. Unlike the federal CTA, the NYTA is not subject to suspensions, so it’s important to understand the key differences and ensure compliance.

Written by: Shalini Natesan, Esq. & Jordan Porter, Law Clerk

The Towne Law Firm’s business law team provides advice and counsel to both publicly and privately held companies. We serve a wide range of industries, from small, closely held businesses to large entities with hundreds of employees and annual revenues in the hundreds of millions. Our team has the experience to address the various issues that arise in business formation, ownership, and operations.