On Sunday, March 2, 2025,
the U.S. Treasury Department announced that it would not enforce the Beneficial Ownership Information (BOI) reporting requirement for U.S. citizens and domestic companies.
Here are more details regarding the suspension of Beneficial Ownership Information (BOI) reporting enforcement by the U.S. Treasury Department:
- Background: The BOI reporting requirements were established under the Corporate Transparency Act (CTA) in 2021. The goal was to combat illicit finance and shell company formation by requiring businesses to disclose details about their beneficial owners to the Treasury’s Financial Crimes Enforcement Network (FinCEN).
- Suspension Announcement: On Sunday, the U.S. Treasury Department announced that it would not enforce penalties or fines associated with BOI reporting for U.S. citizens and domestic companies. This decision alleviated the regulatory burden on small businesses, which are considered the backbone of the American economy.
- Focus Shift: The enforcement efforts will now be directed exclusively at foreign companies. The Treasury Department will issue a proposed regulation to apply the BOI rule exclusively to foreign reporting companies.
- Penalties and Fines: Previously, businesses that failed to comply with BOI reporting requirements faced civil penalties of up to $591 per day (adjusted for inflation) or criminal fines of up to $10,000 and up to two years in prison.
- Legal Challenges: The enforcement of BOI reporting requirements had already faced multiple delays due to legal challenges. The preliminary injunctions against enforcement in these cases have been lifted.
- Statements: U.S. Secretary of the Treasury Scott Bessent called the decision “a victory for common sense” and emphasized that it is part of President Trump’s agenda to reduce burdensome regulations on small businesses2. President Trump also praised the move, describing the BOI rule as “outrageous and invasive” and “an absolute disaster” for small businesses.
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