Corporate Transparency Act

A domestic “Reporting Company” is any corporation, limited liability company, limited partnership or other entity formed under applicable law by filing an organizational document with any state, U.S. territory, the District of Columbia or U.S. Indian tribe that does not qualify for one of the 23 statutory exemption categories under the CTA.

A foreign “Reporting Company” is any business entity organized outside of the U.S. that is registered to do business in the United States by filing a document with any state, U.S. territory, the District of Columbia or U.S. Indian tribe and that does not qualify for an exemption under any of the 23 categories listed below.

Entities such as unincorporated sole proprietorships, general partnerships and trusts whose formation is not contingent upon the public filing of an organizational document with a state secretary of state (or comparable governmental agency) are not treated as Reporting Companies under the CTA.

The following 23 categories of entities are statutorily exempt from any CTA filings and are not classified as “Reporting Companies”:

1. Securities reporting issuers (required to file ’34 Act periodic reports).
2. U.S., state and local governments, and instrumentalities, agencies and subdivisions.
3. Banks.
4. Federal and state licensed credit unions.
5. Bank holding companies and savings and loan holding companies.
6. Registered money services businesses.
7. SEC registered broker or dealers in securities.
8. SEC registered securities exchange or clearing agencies.
9. Other SEC registered ‘34 Act entities.
10. SEC registered investment companies and SEC registered investment advisers.
11. Venture and private equity capital fund advisers (files Form ADV with SEC).
12. Insurance companies.
13. State-licensed insurance producers.
14. Commodity Exchange Act registered entities (e.g., commodity trading advisors, futures commission merchants, and commodity pool operators).
15. Public accounting firms registered with PCAOB.
16. Regulated public utilities.
17. Financial market utilities.
18. Pooled investment funds/vehicles (VC funds and larger PE buy-out and hedge funds).
19. Tax-exempt non-profit entities referenced in IRC 501(c) and exempt from U.S. taxation under IRC 501(a); and political organizations referenced in IRC Sec. 527.
20. Entities (owned and controlled by U.S. persons) exclusively assisting a tax-exempt non-profit entity.
21. Large operating companies (more than 20 full-time employees and more than $5 million of annual revenues shown on its most recent tax return).
22. Subsidiaries. Companies whose equity is “controlled or wholly-owned” by one or more entities described in the exempt categories listed in this chart other than categories 6, 18 and 20 above and 23 below.
23. Inactive entities (formed prior to 2020, inactive and with less than $1,000 in assets).

Each Reporting Company must include the following in its initial BOI Report submission:

Entity-related identifying information about the Reporting Company:

• Entity’s full legal name.
• Any trade name, “doing business as” (d/b/a) or “trading as” (t/a) names.
• Current street address of the principal place of business, if the principal place of business is in the United States, or if the principal place of business is outside the United States, the current street address from which the company conducts business in the United States.
• Jurisdiction of formation or registration.
• IRS Taxpayer Identification Number.

Individual-related information about each (controlling) “Beneficial Owner”:

• Beneficial Owner’s full legal name.
• Date of birth.
• Residential street address.
• Unique identifying number from an acceptable identification document, including:
  • Non-expired driver’s license.
  • Non-expired identification document issued by a U.S. state or local government for the purposes of identifying the individual.
  • Non-expired passport issued by the U.S. government.
  • If none of the three forms above are applicable, non-expired passport issued by a foreign government.
• Image of the identification document.
• Name of the state or jurisdiction that issued the identification document.

The CTA Rule defines “Beneficial Owners” as any individual who either (i) directly or indirectly “owns or controls not less than 25% of the ownership interests of the entity” OR (ii) “directly or indirectly…exercises substantial control over [the] Reporting Company.”

The CTA does not cap the number of Beneficial Owners that may be listed on an initial BOI Report.

Individual-related information about each “Company Applicant”:

Each Reporting Company that forms after December 31, 2023 (or first registers to do business in the United States after December 31, 2023) must include on its initial BOI Report the same individual-related information required of a Beneficial Owner for at least one but no more than two “Company Applicants.” The CTA Rule defines “Company Applicants” as the individual who “files” the document that creates a U.S. domestic business entity or registers a non-U.S. business entity to do business in the U.S., and, if more than one individual is involved in the filing of the document, the individual who is “primarily responsible” for directing or controlling such filing. No more than two individuals per Reporting Company are subject to “applicant” disclosure.

In light of the U.S. Treasury Department’s March 2, 2025, announcement, CTA reporting deadlines are currently suspended and are expected to be updated pending FinCEN’s forthcoming issuance of a new interim CTA final rule to be issued no later than March 21, 2025.

On December 3, 2024, a Federal District Court in the Eastern District of Texas issued a nationwide preliminary injunction prohibiting any enforcement of the federal CTA and the Beneficial Ownership Information Reporting Requirements Final Rule. On December 5, 2024, the U.S. Treasury appealed the district court ruling to the U.S. Court of Appeals for the Fifth Circuit Court of Appeals. On December 23, 2024, the U.S. Court of Appeals for the Fifth Circuit issued a per curiam opinion (signed by Judges Stewart, Hayes and Higginson) lifting the district court’s preliminary injunction pending the outcome of the U.S. Treasury’s ongoing appeal of the district court’s order. However, a separate panel of the Fifth Circuit subsequently reinstated the preliminary injunction.  The case citation is Texas Top Cop Shop, Inc. v. Garland, No. 24-40792 (5th Cir.). The Circuit Court’s opinion and order are available here. On January 23, 2025, the Supreme Court entered an order staying the preliminary injunction in the Top Cop Shop case pending the final resolution of the related appellate proceedings. Despite the Supreme Court’s decision in the Top Cop Shop case, the CTA reporting obligations remained on hold due to a separate nationwide injunction issued by a different judge of the U.S. District Court for the Eastern District of Texas in the case styled Smith v. U.S. Department of the Treasury.

On February 18, the U.S. District Court for the Eastern District of Texas lifted the preliminary injunction previously granted by that court in the Smith case. In response, on February 18, the U.S. Treasury’s Financial Crimes Enforcement Network (FinCEN) extended the deadline to March 21, 2025, for non-exempt reporting companies to file their initial, updated or corrected beneficial ownership information (BOI) reports. FinCEN’s February 27 release further announced a moratorium on any penalties, fines or other enforcement action against reporting companies that fail to file beneficial ownership information reports “until a forthcoming interim final rule becomes effective and the new relevant due dates in the interim final rule have passed.”

On March 2, the U.S. Department of Treasury declared an indefinite moratorium on any enforcement of the CTA reporting obligations applicable to U.S. companies and its owners announcing that it will “not enforce any penalties or fines against U.S. citizens or domestic reporting companies or their beneficial owners.” The combined effect of the March 2 Treasury and February 27 FinCEN actions is to limit, for the indefinite future, the companies subject to CTA compliance to non-U.S.-formed entities that have qualified to do business in the United States.

Despite these recent pronouncements from FinCEN and the Treasury Department, litigation surrounding the constitutionality of the CTA remains ongoing. The appellate proceedings in National Small Business United v. Yellen (NSBA) currently playing out in the Eleventh Circuit Court of Appeals bear particular attention. Oral arguments in NSBA occurred in November and the Eleventh Circuit could decide soon on the merits regarding the constitutionality of the CTA. Although the Fifth Circuit has expedited briefing in the Top Cop Shop appeal, any decision in that case will be rendered after the March 21 final rule is announced by FinCEN since oral arguments are not set to occur until April 1, 2025.

Appeals are also currently pending in the Fourth and Ninth Circuits following decisions by the U.S. District Courts for the Eastern District of Virginia and the District of Oregon, respectively, concluding that the CTA is constitutional. Notably, U.S. Department of Justice (DOJ) attorneys under the Trump Administration have filed briefs in the Fourth and Fifth Circuits vigorously defending the constitutionality of the CTA. By contrast, many Republican State Attorneys General also filed amicus appellate briefs in the Top Cop Shop case asserting the unconstitutionality of the CTA.

Further frustrating efforts to predict the trajectory of the CTA, the bipartisan passing of H.R. 736, and subsequent introduction of S.B. 505 appear to indicate a willingness from the legislative branch to reconsider the burdens of the CTA’s reporting obligations on companies. Additionally, the pronouncements by FinCEN on February 18 and 27 and by the Treasury Department on March 2 indicate the apparent intention of the Trump administration to narrow the scope of the Reporting Rule by regulatory action. While the CTA’s implementation remains difficult to predict, the March 21 deadline is currently applicable to all non-U.S.-formed entities that have qualified to do business in the United States that have not yet filed an initial beneficial ownership report with FinCEN.

Pending resolution of these judicial challenges, reporting companies should continue to diligently monitor judicial and administrative developments. Reporting companies may wish to gather the necessary materials to complete and file any required BOI Reports, and amendments, in accordance with FinCEN’s reporting requirements should they be reinstated.

Our CTA Task Force has put together some additional resources to help you stay informed on the latest developments related to this new law.

Filing Information

• BOI E-Filing System
• Filing Instructions / Resources
• BOIR E-Filing Instructions (PDF)
• BOIR Fillable Form (PDF)

FinCEN Resources / Guidance

• FinCEN Reference Materials (Rules and Regulations)
• FinCEN Beneficial Ownership Information Reporting – FAQs
• FinCEN Beneficial Ownership Information – Small Entity Compliance Guide