By Andrew Miller
Nearly every small business in the U.S. had been required to report its ownership to the federal government since January 2024.
Most never got around to it.
Only about 9.5 million businesses had actually submitted the report. That’s roughly 30 percent of the businesses required to file.
Going forward, none will ever have to.
The Corporate Transparency Act, passed in 2021, required small businesses to report who owns them to the Treasury Department’s Financial Crimes Enforcement Network (FinCEN).
The requirement took effect in 2024, with a January 1, 2025 deadline for existing businesses. Miss it, and the penalty ran $591 a day, with criminal exposure attached.
A federal court in Texas found the law likely unconstitutional on December 3, 2024, ruling on a lawsuit brought by the National Federation of Independent Business and a small business called Texas Top Cop Shop. The court issued a nationwide injunction less than a month before the deadline hit.
The incoming Treasury Department didn’t wait for a final ruling.
In March 2025, under new leadership, FinCEN issued an interim rule exempting U.S. companies from the reporting requirement entirely. It would be narrowed down to foreign entities registered to do business here.
However, the change was always labeled interim. FinCEN just made it permanent.
The final rule took effect August 14.
It does more than lock in the exemption. FinCEN is also deleting the ownership information that owners already submitted, before the exemption existed, from its database.
Foreign companies registered to operate in the U.S. still have to report. And foreign beneficial owners of those companies still get named. Everyone else is out, and now so is their paperwork.
Owners who filed under the original rule aren’t being asked to do anything. FinCEN is handling the deletion on its own. Those who never filed, whether by choice or because the requirement got interrupted before they got to it, are simply no longer required to.
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