FinCEN Final Rule Exempts US Entities From CTA Reporting
A FinCEN final rule exempts domestic entities and US persons from CTA beneficial ownership reporting, but foreign companies still have narrowed obligations and financial institutions' separate CDD rules are unchanged.
In a significant policy reversal, the Financial Crimes Enforcement Network (FinCEN) has issued a final rule that permanently exempts domestic entities from the reporting requirements of the Corporate Transparency Act (CTA). The rule, published August 14, 2026, also removes U.S. persons from the definitions of reportable “beneficial owners” and “company applicants.”
This change effectively ends the broad beneficial ownership information (BOI) reporting regime for millions of U.S. companies. For sophisticated counsel and clients, this eliminates a major compliance burden. However, foreign entities registered to do business in the U.S. remain subject to a narrowed reporting framework, though they no longer need to report information on U.S. beneficial owners. Crucially, FinCEN emphasized that the rule does not alter financial institutions’ separate Customer Due Diligence (CDD) obligations.
Counsel should advise domestic clients that CTA filings are no longer required and note that FinCEN plans to purge their previously submitted data. Law firms should also update advice for foreign-entity clients on their revised, narrower duties and confirm that financial-institution clients understand their CDD obligations continue unchanged.