On August 11, 2026, the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) announced it is issuing a final rule that permanently removes the requirement for U.S. companies and U.S. persons to report beneficial ownership information to FinCEN under the Corporate Transparency Act. The final rule became effective on August 14, 2026, its date of publication in the Federal Register. FinCEN also announced that it will delete previously reported information by U.S. persons—now exempt from the CTA reporting requirements under the final rule—from the beneficial ownership information database.

The final rule:

  • Adopts the exemptions set out in the interim final rule issued in March 2025, making the rollback of beneficial ownership reporting by U.S. companies permanent.
  • Exempts U.S. persons who have obtained FinCEN IDs from any obligation to update or correct the information they originally provided to FinCEN to obtain their FinCEN IDs.
  • Eliminates the requirement for foreign companies to report U.S. person “company applicants” (i.e., the individuals who helped those foreign companies register to do business in the United States).
  • Exempts foreign pooled investment vehicles registered in the United States from reporting the beneficial ownership information of a U.S. person in control of the investment vehicle.
  • Confirms that FinCEN will delete information about any individuals—company applicants, beneficial owners or recipients of a FinCEN ID—that FinCEN reasonably believes is a U.S. person (e.g., the information is linked to a U.S. passport or U.S. driver’s license).

Under the final rule, foreign entities that are reporting companies will still be required to report beneficial ownership information for foreign individuals.

There are still outstanding and potential legal challenges to the CTA (including the final rule on grounds that it does not comport with the statute as passed by Congress or otherwise).  Accordingly, both U.S. and foreign reporting companies and their U.S. and foreign beneficial owners are well-advised to continue to monitor CTA developments even if they are exempt from beneficial ownership information reporting under the final rule. 

Duane Morris is monitoring the CTA and issuing Alerts on critical developments, including the final rule. To receive Duane Morris Alerts on the CTA, please register for our CTA mailing list.

The Corporate Transparency Act of 2021 (CTA), effective January 1, 2024, introduced new compliance burdens and potential hefty penalties.

This law is a product of the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN). The CTA requires reporting companies—i.e., most every corporation, partnership, limited liability company or statutory trust formed or created by the filing of documentation with a U.S. state or territorial government and any foreign entity registered with a state or territorial government to do business in that state or territory—to make certain filings about individuals who are “beneficial owners” of those entities.

The CTA imposes compliance burdens on reporting companies, together with hefty penalties for noncompliance. There are a number of exemptions, but companies need to determine if one of the CTA’s 23 precisely drawn exemptions applies. A failure to comply that is determined to be “willful” might give rise to a criminal fine of as much as $10,000 and imprisonment for up to two years. Even if a criminal charge is avoided, a failure to file may result in a $500 per day civil penalty (as indexed for inflation).

These penalties are the sharp teeth in the CTA’s effort to ferret out persons involved in money laundering and similar activities through the use of shell companies in the U.S. However, the wide net of the CTA can impact a range of companies—from the smallest of entities used for valid business or investment purposes to the largest of companies. Even inactive entities can be required to report.   

The CTA requires each reporting company (namely, every kind and size of entity that exists on December 31, 2023, which cannot conclude that it qualifies for an exemption) to file with FinCEN information regarding itself and its beneficial owners not later than January 1, 2025. Entities created or first registered on or after January 1, 2024, must file within 90 days following their creation or first registration (the 90-day period is reduced to 30 days for entities formed or first registered in 2025 or beyond). If the information in a filing changes, the affected entity has only 30 days to update its filing. For current updates to these FinCEN filing deadlines, see headline box above. 

Duane Morris’ CTA Strategy Team

Duane Morris is actively monitoring developments regarding the CTA and issuing Alerts on the topic. To receive future Duane Morris Alerts on the CTA, please register for our CTA mailing list. Duane Morris will provide advice to clients regarding CTA compliance only when explicitly engaged to do so in writing. 

For More Information

For more information, please contact Thomas R. Schmuhl or any of the CTA Strategy Team members referenced in the Attorney Listing.