- within Insolvency/Bankruptcy/Re-Structuring topic(s)
On August 11, FinCEN announced a final rule permanently exempting U.S. companies and U.S. persons from beneficial ownership information (BOI) reporting requirements under the Corporate Transparency Act (CTA). The rule is scheduled for publication in the Federal Register on August 14, 2026, and will become effective upon publication.
The final rule adopts the exemptions first established through FinCEN’s March 2025 interim final rule and substantially narrows the CTA reporting regime. Specifically, the rule:
- Permanently exempts domestic companies and U.S. persons. U.S.-formed entities and U.S. persons are no longer required to submit BOI reports to FinCEN.
- Eliminates certain FinCEN ID obligations. U.S. persons who obtained FinCEN IDs are no longer required to update or correct information previously provided to obtain those identifiers.
- Narrows reporting by foreign companies. Foreign reporting companies are no longer required to report U.S. person company applicants or U.S. person beneficial owners, while BOI reporting requirements continue to apply to foreign beneficial owners.
- Provides for deletion of previously submitted information. FinCEN announced that it will delete information concerning domestic entities and individuals that it reasonably believes are U.S. persons. Certain foreign companies registered to do business in the United States remain subject to BOI reporting.
Putting It Into Practice: The final rule substantially reduces CTA compliance obligations for domestic businesses, but it does not eliminate financial institutions’ separate customer due diligence and other anti-money laundering obligations. As FinCEN removes domestic and U.S.-person information from its BOI database, financial institutions will continue to rely on their own customer due diligence and risk-based controls when evaluating ownership structures. Given the CTA’s politically contentious history and extensive prior litigation, further legal challenges to the final rule are likely, particularly because the rule substantially narrows a statute that remains in effect. Businesses and financial institutions should continue monitoring related legislative, regulatory, and litigation developments and update compliance procedures as necessary.
**As the final rule gets published, please monitor this space for updates**
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