The Trump Treasury Department announced this week that it will not enforce any fines or penalties associated with reporting requirements under the Corporate Transparency Act (CTA), delivering a major victory for some 32 million small business owners nationwide.
The department wrote in an X thread on Sunday that “not only will it not enforce any penalties or fines associated with the beneficial ownership information reporting rule under the existing regulatory deadlines [of the CTA], 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.”
Treasury Secretary Scott Bessent called the move “a victory for common sense” and said it was “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.”
In a post on Truth Social, President Trump called the CTA’s reporting requirements “outrageous and invasive” and “an economic menace,” adding that the Biden administration’s enforcement of the law “has been an absolute disaster for small businesses nationwide.”
Passed as part of the 2021 National Defense Authorization Act (NDAA), the CTA was enacted despite President Trump’s veto, which Congress overrode to install this sweeping federal mandate. Under the pretense of combating financial crimes, the CTA compels millions of small businesses to disclose sensitive personal information to the Financial Crimes Enforcement Network (FinCEN) or face steep fines and even jail time.
In theory, the CTA applies to all businesses that operate in the United States. But loopholes and special carve-outs allow large corporations to avoid disclosures – meaning that the regulatory burden falls disproportionately on everyday entrepreneurs. Large companies can still use foreign entities (like shell corporations) that are not subject to the same regulations as domestic businesses, allowing them to shield their ownership from both U.S. authorities and the CTA’s disclosure requirements.
Rather than focusing on real financial criminals, the CTA treats every small business owner like a suspect, stripping states of their long-held regulatory authority and consolidating even more power in Washington. Worse, the CTA creates a massive federal database of personal information – which can be accessed without a judicial warrant – raising serious privacy and cybersecurity concerns, as FinCEN has suffered repeated breaches in the past.
Moreover, many small businesses lack the resources for dedicated legal or accounting teams and must hire outside professionals to meet the CTA’s requirements. Beyond initial filing costs, businesses must also bear ongoing expenses for updating ownership information, creating a recurring burden. As one user posted on X in response to the news, “I spent $350 to comply with this crap. Where do I send my invoice to be compensated?”
The threat of steep fines and penalties for non-compliance further exacerbates the financial risk, potentially driving small businesses to close or scale back operations. Ultimately, the CTA’s complex requirements and financial penalties stifle entrepreneurship, imposing burdens on those least equipped to handle them.
Despite these concerns, the bill was enacted with overwhelming bipartisan support in both chambers of Congress. Although some Republicans, including Rep. Thomas Massie (KY) and Senators Rand Paul (KY) and Mike Lee (UT) voiced their opposition, the 2021 NDAA ultimately passed by a vote of 335 to 78 in the House and 84 to 13 in the Senate.
Since then, the CTA has faced significant legal challenges, particularly regarding its privacy implications and the scope of its requirements. While some lawsuits have contested the federal government’s authority to impose the CTA’s regulations, courts have largely upheld the law. In January, the Supreme Court issued a ruling overturning a lower court order temporarily blocking implementation of the CTA.
Now, however, the Trump administration has effectively neutralized the law by announcing that businesses won’t be punished for violating it.
The move is sure to elicit plenty of outrage from Democrats and a corporate media always eager to jump on any opportunity to portray the Trump administration as overly friendly to big business. Liberals will surely spin it as an effort to shield tax cheats and financial criminals from transparency and accountability.
But the reality of the CTA is that, much like gun control laws, it was only ever going to hurt legal, law-abiding business owners while doing little to punish criminals. If large corporations can get around the CTA’s disclosures simply to avoid the annoyance of filing them, then criminals can surely avoid them as well.
Notably, the Treasury Department also said that it will “further be issuing a proposed rulemaking that will narrow the scope of the rule to foreign reporting companies only.” It’s a policy that’s perfectly in line with Trump’s “America First” agenda – cut burdensome regulations for American citizens while still placing a high burden of entry on foreign entities that want access to the U.S. economy.
While the Trump administration’s move provides expedited relief for small businesses, however, that relief may only be temporary. The most permanent solution to the CTA would be repealing the law altogether. In January, Rep. Warren Davidson (R-OH) and Senator Tommy Tuberville (R-AL) re-introduced the “Repealing Big Brother Overreach Act” to do just that.
Nonetheless, the Trump administration’s announcement is a step in the right direction. Small business owners can all breathe a sigh of relief.
Shane Harris is the Editor in Chief of AMAC Newsline. You can follow him on X @shaneharris513.
As a Small Business Owner, I thank you, Mr. President. But gotta ask “Why hasn’t our elected representatives in Congress done this?”
The Democrats are already preparing the lawsuits. They hate anything that benefits small business owners or benefits the country. If it’s not part of the destruction of this nation they want no part of it. They have already come out squarely in favor of waste Fraud and Abuse, and with the help of George Soros already protesting government employees having to justify their jobs. If you cannot come up with five bullet points about what you did last week, obviously you did nothing. But according to the Democrats you should get paid for doing nothing.. don’t get me started Democrats make my butt itch so much I can’t scratch enough
Burdening small business owners with tons of paperwork raises our prices! Good job, President Trump, in trying to help out our businessmen and women!
Great move. Hopefully we will see more of this. Next fewer regulations, NOT more
The damage is already done. Most people/entities have already complied – the data is already stored on fincen servers. And if the underlying law isn’t repealed, then compliance can easily be once again enforced. Our elected officials need to eliminate this requirement to make its demise permanent.
States should be solely responsible for this information for Domestic companies, as it was before the CTA.
If this had been done back during Obama’s day I would still be working at my favorite job!
Congress MUST codify these changes or these four years will just hang in the balance pending a possible democratic party win in two years. Please tell congress to get off their butts and do something productive for America.
Small business is if not a backbone then a very important component of this country, left is trying to break it, it knows that comfortable middle class is what separates the rich from “working class,that with perseverance it’s achievable to leave the status of poverty . left pretends to stand up for working man and make him equal, to whom they don’t say It sure as hell is not the democrat willing to share his money with deserving poor for whom he fights.I wish dems would leave the trampled upon alone , been using them as a prop to advance their own agenda for eons..
They passed this bill a little too late to catch Biden and his LLC shell game. Now us small business owners have to pay. This was a total waste of my time. You could have done it online for free, but they asked the same question 15 times. It was annoying after a while. All of those question could have been answered by my LLC charter and annual tax filings.
Honda has announced it will produce Civics in Ohio not Mexico… why? Because of TARIFFS! How does that crow taste, left?
This is a big step in the Right Direction! KEEP GOING!! Small business are STILL shutting DOWN around us! Hopefully with more incentives the REAL American Dream can come alive again!
“Democrats” have exhibited that they like to steal money (via damaging legislation) to make “wealth transfers” to those whom they favor. On the other hand, they are deeply bothered by entire classes of people who do well financially, without the approval and sponsorship of… “democrats”. They want to be the ones who control the money supply.
I had to do this crap for 5 businesses. I would like reimbursed.
Of course the small business owners will suffer. Like every law, regulation, rule and mandate the Biden administration has passed. It’s like with anything in their platform. Hurt the small business owner and the rest of the hardworking stiffs. We are working to support the war in the Ukraine, Hamas in Gaza, illegal migrants Biden has let into the country and into our every day lives. Our tax money pays for their livelihood. Like we pay for all the perps that have been let out of prison. Every organization that obeys the Biden laws and regs. get monetary support. Judges have been bribed. Along with AG’s and DA’s. They are against saving money by DOGE. They scream bloody murder. What are you going to do with all those bureaucrats you fired? They never screamed that tax money went to migrants and the citizens were denied any help. But it’s okay to employ thousands of federal workers who are not needed. Or get rid of the slackers. Saw a comic strip in the paper today where a sign outside a restaurant advertised for a chef. It said “Must hate cooking and the restaurant industry. No experience necessary”. The man in this strip said to his wife “Looks like the people who say government should be run like a business got their wish”. Exactly. If business was run like the government we all be on the street. The Biden administration ran the administration to get votes and break the treasury. Trump is running the govt like a business. Sacrifices have to be made. Wait till there is no more money for Social Security payments or they cut the payments by 30%. What will the dems do then. They are paying Soc Sec payments to illegals. This makes the time we will run out of Soc Sec payments sooner than 2033 more like 2030. But let us keep the inefficient bureaucrats. And spend billions of dollars of USAID for Trans causes all over the world. Let’s keep trans in women’s sport. Where are those little males going to go. Play with the big boys. Well then they can’t win. That is why they proclaim to be female. Gives them access to girls lockerrooms and bathrooms. All this to keep us obeying the dem and the billionaires elite. This last group is tired to pay for us people. Just get rid of them. And the dem puppets in the congress go along with it. Common sense are two words the dems have eliminated from their dictionary and vocabulary. TDS is alive and well.
The scope of the law is so broad that it also applies to other organizations like homeowner’s associations. So, because I’m a member of my HOA Board, I have to register with the government, even though I receive no payment for my service. This law is the textbook definition of “government overreach!”
Needed & long overdue
The business of America is business. -Calvin Coolidge