The rules governing beneficial ownership information reporting have undergone a dramatic transformation since the Corporate Transparency Act (CTA) came into force — and compliance teams that have not kept pace risk misreading their obligations entirely.
According to Alessa, enacted to tackle money laundering, tax fraud, and the exploitation of anonymous shell companies within the US financial system, the CTA introduced a requirement for certain companies to disclose identifying details about the individuals who ultimately own or control them.
Alessa recently delved deeper into the topic of beneficial ownership information (BOI) requirements in 2026.
Under the framework established by FinCEN, a beneficial owner is any individual who directly or indirectly exercises substantial control over a reporting company, or who owns or controls 25% or more of its ownership interests. Required disclosures include full legal name, date of birth, residential or business address, and a copy of a valid government-issued ID.
When the CTA took effect on 1 January 2024, it initially applied to tens of millions of domestic and foreign entities. What followed was a turbulent stretch of legal challenges, competing court injunctions, and enforcement pauses. A federal district court lifted one such injunction in February 2025, reinstating reporting with a 21 March 2025 deadline — only for the Treasury to announce days later that it intended to exempt domestic companies from the obligation altogether. An interim final rule removing BOI requirements for all US domestic companies was published in the Federal Register on 26 March 2025 and took immediate effect.
The scale of that rollback is significant. The Small Business Administration’s Office of Advocacy estimated the change would save small businesses $6.7bn annually over the next decade.
As of today, only foreign entities remain within scope. US domestic companies of all types, along with the beneficial owners of those companies and US persons who beneficially own foreign reporting companies, face no BOI filing requirement. Foreign companies registered to do business in the US, however, must still comply. Those registered before 26 March 2025 had an initial BOI report due by 25 April 2025. Those registering on or after that date must file within 30 calendar days of receiving notice of effective registration.
Compliance teams should note that FinCEN has signalled it intends to finalise the interim rule, meaning the picture could shift further. Tracking subsequent rulemaking is advisable.
Critically, the removal of domestic BOI obligations does not signal a broader loosening of financial crime prevention expectations. BOI reporting was always one layer within a wider compliance architecture. Whilst FinCEN has granted covered financial institutions some relief from verifying beneficial owners at every new account opening — allowing reliance on previously obtained information unless new facts or risk-based procedures call for an update — ongoing obligations remain firmly in place. These include transaction monitoring for suspicious activity, sanctions screening against OFAC, PEP lists, and other watchlists, as well as suspicious activity report (SAR) and currency transaction report (CTR) filing requirements.
For financial institutions serving foreign clients, the 30-day filing window for newly registered foreign entities also has direct operational implications. Customer intake and KYC processes must be calibrated accordingly to avoid onboarding delays or compliance gaps.
The CTA’s underlying rationale — reducing the anonymity that enables financial crime through opaque ownership structures — has not been abandoned, even as its specific requirements have narrowed. Regulators continue to expect robust AML compliance programmes. The risk environment is unchanged; only one instrument used to address it has been modified. Compliance frameworks built on durable fundamentals, rather than those structured around satisfying a single filing requirement, are far better placed to absorb shifts like these without losing ground.
Read the full Alessa post here.
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