U.S. FinCEN Issues Final Rule Ending Beneficial Ownership Reporting Requirement

On August 11, 2026, the U.S. Department of the Treasury Financial Crimes Enforcement Network (FinCEN) issued a final rule rolling back prior regulations under the Corporate Transparency Act requiring U.S. companies and U.S. persons to report beneficial ownership information. Alongside the final rule, FinCEN announced that it will delete previously reported information by U.S. persons from the beneficial ownership information database.

Congress enacted the Corporate Transparency Act (CTA) on January 1, 2021, as part of the Anti-Money Laundering Act of 2020 to combat the misuse of anonymous shell companies for money laundering, terrorist financing, tax fraud, and other illicit activity by requiring entities operating in the United States to disclose their true beneficial owners to a secure, nonpublic database maintained by the Financial Crimes Enforcement Network (FinCEN). In 2022, FinCEN issued a final rule implementing the CTA reporting requirements and requiring domestic and foreign entities to report beneficial ownership information (BOI) about the individuals who directly or indirectly own or control them (the Reporting Rule).  The Reporting Rule’s regulatory impact analysis estimated the affected population at approximately 32.6 million entities.

As discussed in our prior Updates, the CTA was challenged by a coalition of small businesses on constitutional grounds, and in late 2024 and early 2025, federal district courts issued nationwide injunctions halting enforcement. Following the change in presidential administrations, the Department of the Treasury (Treasury) announced on March 2, 2025, that it would suspend enforcement against U.S. citizens and domestic reporting companies. FinCEN then announced an interim final rule on March 26, 2025 (the IFR), which exempted domestic reporting companies and U.S. person beneficial owners pending further rulemaking.

Key Changes in the Final Rule

The Final Rule adopts the IFR’s exemptions and extends them in the following respects:

• Permanent exemption for domestic reporting companies. All entities created in the United States are permanently exempt from filing initial, updated, or corrected BOI reports

• Elimination of U.S. person company applicant reporting. Foreign reporting companies no longer must identify U.S. person “company applicants” — that is, the individuals who filed (or directed the filing of) the foreign entity’s U.S. registration documents. The IFR had left this obligation in place; the Final Rule removes it.

• Relief for U.S. person FinCEN ID holders. U.S. persons who obtained a FinCEN identifier (a unique number issued by FinCEN upon request to streamline future filings) are no longer required to update or correct that information. Non-U.S. persons who hold FinCEN IDs must continue to update or correct their information within 30 days of any change.
• Foreign pooled investment vehicle exemption. Foreign pooled investment vehicles registered in the United States no longer must report the BOI of any U.S. person exercising substantial control over the vehicle. If no individual with substantial control is a non-U.S. person, the vehicle need not report any beneficial owners.

• Deletion of U.S. person data. FinCEN will delete from its database information about individuals it reasonably identifies as U.S. persons (e.g., records linked to a U.S. passport or driver’s license), including data submitted by beneficial owners, company applicants, and FinCEN ID holders.

Who Must Still Report

Under the Final Rule, only foreign entities constitute “reporting companies” subject to BOI reporting obligations for their non-U.S. person beneficial owners. The Final Rule defines “reporting company” as an entity formed under the law of a foreign country that has registered to do business in any U.S. state or tribal jurisdiction. There are multiple categories of entities exempt from the reporting requirement; foreign entities should carefully review the qualifying criteria before concluding whether they must report. FinCEN estimates that there are approximately 28,000 such foreign entities required to report, of which roughly 13,000 had already filed reports as of the end of 2025.

Practical Implications

For U.S. companies and their beneficial owners. The domestic BOI reporting obligation is permanently extinguished. Companies that previously filed reports with FinCEN need not take any further action, and FinCEN will delete U.S. person data from its database.

For domestic financial institutions. FinCEN’s 2016 Customer Due Diligence Rule (the CDD Rule), which requires covered financial institutions to identify and verify the beneficial owners of their legal entity customers at account opening, remains in effect and is unaffected by the Final Rule. With domestic companies no longer required to file BOI reports with FinCEN, the CDD Rule is now the primary source of domestic beneficial ownership information available to the financial system and law enforcement. The Final Rule does not affect the CDD Rule, though FinCEN has stated that it intends to modify the CDD Rule to address several open questions now that changes to the BOI reporting requirements have been completed. FinCEN has not committed to a timeline or indicated the direction of those modifications. Financial institutions should continue to comply with their existing CDD obligations and monitor for further rulemaking.

For foreign companies registered in the United States. The reporting obligation persists in substantially narrower form. Foreign reporting companies must still report BOI for non-U.S. person beneficial owners but need no longer identify U.S. person company applicants or report U.S. persons exercising substantial control over foreign pooled investment vehicles. Foreign companies should also confirm their applicable reporting deadlines. Under the IFR, entities that were reporting companies before March 26, 2025, were required to file within 30 days of that date (i.e., by April 25, 2025). Entities that become reporting companies after March 26, 2025, must file within 30 days of receiving notice that their registration is effective. The Final Rule does not alter these deadlines.

 

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FinCEN’s Final Rule is available here pending publication in the Federal Register. The press release announcing the Final Rule is available here. FinCEN’s Q&A regarding the Final Rule is available here.

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¹ The Reporting Rule defined “reporting company” to include, inter alia, any corporation, limited liability company, or other entity created by filing a document with a Secretary of State or similar office under state or tribal law, subject to 23 exemptions for already regulated or large entities. See 31 C.F.R. § 1010.380(c)(1)(i) (2023); 31 U.S.C. § 5336(a)(11)(B)(i)–(xxiii). In practice, nearly every U.S.-registered LLC, corporation, or similar entity not already subject to separate federal or state disclosure requirements was required to report BOI to FinCEN.