The CTA is Off...and On..and Off...and On...and Off..For Good This Time?

On March 2nd, 2025 the Treasury Department announced suspension of enforcement of the Corporate Transparency Act (CTA) against U.S. citizens and domestic reporting companies. Specifically:

The Treasury Department is announcing today that, with respect to the Corporate Transparency Act, not only will it not enforce any penalties or fines associated with the beneficial ownership information 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. The Treasury Department will further be issuing a proposed rulemaking that will narrow the scope of the rule to foreign reporting companies only. Treasury takes this step in the interest of supporting hard-working American taxpayers and small businesses and 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.”
---
The administration cannot repeal the law but without enforcement, the CTA loses its teeth. It will be interesting to see how the Treasury Department narrows the scope to hopefully better align with the underlying intent of the CTA.