The Treasury Department announced on March 2 that, with respect to the Corporate Transparency Act (CTA), "not only will it not enforce any penalties or fines associated with the beneficial ownership information (BOI) reporting rule under the existing regulatory deadlines, but it will further not enforce any penalties or fines against U.S. citizens or domestic reporting companies or their beneficial owners after the forthcoming rule changes take effect either."

Additionally, the Treasury will be issuing a proposed rulemaking that will narrow the scope of the rule to foreign reporting firms only.  It said that it is taking this approach in the interest of supporting hard-working American taxpayers and small businesses as well as ensuring that the rule is appropriately tailored to advance the public interest.

“This is a victory for common sense,” said U.S. Secretary of the Treasury Scott Bessent. "Today’s action is part of President Trump’s bold agenda to unleash American prosperity by reining in burdensome regulations, in particular for small businesses that are the backbone of the American economy.”

Prior to this, the Financial Crimes Enforcement Network (FinCEN), which is under the Treasury, stated that the BOI reporting requirements under the CTA are back in effect given the Feb. 18 ruling of the U.S. District Court for the Eastern District of Texas in Smith v. U.S. Department of Treasury.

However, FinCEN acknowledged that reporting firms might need extra time to comply with their BOI reporting obligations. Thus it announced that it was generally extending the deadline to March 21. 

What the Treasury announcement today goes beyond what the FinCEN initially announced on Feb. 27. On that day, FinCEN said, in a release, that it will not issue any fines or penalties or take any other enforcement actions against any firms because of any failure to file or update BOI reports under the CTA by the current deadlines. 

FinCEN stated that no fines or penalties will be issued, and no enforcement actions will be taken, until a forthcoming interim final rule becomes effective and the new relevant due dates in the interim final rule have passed.