Beneficial Ownership & the Corporate Transparency Act

Summary

The Corporate Transparency Act (CTA) was enacted to combat illicit finance, money laundering, and terrorism financing by requiring certain companies to disclose information about their beneficial owners to the Treasury Department's Financial Crimes Enforcement Network (FinCEN).

In February 2025, RER joined a coalition urging Treasury to delay reporting requirements shortly before the department announced enforcement relief. (Coalition Letter, Feb. 3, 2025)

On Aug. 11, 2026, FinCEN issued a final rule permanently eliminating beneficial ownership information (BOI) reporting requirements for U.S. companies and U.S. persons. Effective Aug. 14, the rule finalizes the narrower framework adopted in March 2025, providing long-term regulatory relief for millions of U.S. businesses, including commercial real estate entities. (Roundtable Weekly, Oct. 2, 2026)

The Real Estate Roundtable (RER) continues to work with policymakers in support of a balanced approach that would inhibit illicit money laundering activity without the imposition of costly reporting requirements for real estate investors. 

Key Takeaways

Treasury’s suspension of CTA enforcement for domestic entities significantly reduces compliance burdens for real estate businesses that rely on LLC structures.

See the full fact sheet.

Position

Support Measures that Encourage Capital Formation: RER, along with its coalition partners, repeatedly raised concerns about the regulatory burden posed by the CTA and has supported the court challenges to the law. We are pleased by the Treasury’s constructive action to exempt domestic reporting companies

  • Although the CTA is intended to provide support for law enforcement investigations into shell companies engaged in money laundering, tax evasion, and terrorism financing, it places many costs and legal burdens on small businesses, especially those in the real estate industry.
  • RER welcomes the Treasury’s action to exempt domestic reporting companies and supports efforts to thwart illegal money laundering in real estate, while encouraging policymakers to find a balanced approach that does not unfairly burden law-abiding businesses and encourages capital formation.
Background

CTA Requirements

  • A beneficial owner refers to an individual who owns at least 25 percent of an entity or indirectly exercises “substantial control” over it.
  • The CTA amended the Bank Secrecy Act to require corporations, limited liability companies, and similar entities to supply three categories of information: information about the entity, beneficial ownership information (BOI), and information about the company applicants involved in forming the entity.
  • The CTA authorizes FinCEN to collect and disclose BOI to authorized government authorities and financial institutions, subject to effective safeguards and controls. The statute requires the submission of regular reports to the federal government that include a litany of sensitive personal identifiers of the owners, senior employees, and/or advisors of covered entities.
  • While this disclosure obligation began on Jan. 1, 2024, the U.S. Court of Appeals for the Fifth Circuit vacated the stay on Dec. 26, 2024 and reinstated the nationwide preliminary injunction enjoining enforcement of the CTA and the Reporting Rule, including the impending reporting deadlines.
  • On March 2, 2025, the U.S. Treasury Department announced it would suspend enforcement of the CTA against U.S. citizens and domestic reporting companies, and later issued an interim final rule through FinCEN that eliminated their reporting requirements entirely.
Resources
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