The Corporate Transparency Act (CTA) requires most U.S. businesses to report their beneficial owners to the Financial Crimes Enforcement Network (FinCEN). However, some types of businesses are exempt from these reporting requirements. Here’s a quick guide to the key exemptions:

Who is Exempt?

1. Large Operating Companies:
   • Must meet all three criteria:
     • Over 20 full-time U.S. employees.
     • More than $5 million in revenue.
     • A physical office in the U.S.​.
2. Publicly Traded Companies:
   • Companies listed on U.S. stock exchanges already report ownership to the SEC, so they are exempt.
3. Regulated Entities:
   • Financial institutions like banks, credit unions, insurance companies, and brokers, which are already regulated by federal agencies.
4. Inactive Companies:
   • The entity was in existence on or before January 1, 2020
   • Not owned by a foreign person
   • No change in ownership over the past 12 months
   • Entities that haven’t engaged in business or financial transactions (less than $1,000 in the past year)
   • Hold no assets

These exemptions help reduce the reporting burden on larger and more regulated companies, who are likely already reporting ownership interest through other regulations. The CTA is meant to target companies that don't have existing ownership reporting and could be anonymous shell companies that could be used for illicit activities. Most small businesses will have to report.

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For more information, visit FinCEN or for all the detail, see p. 11 of FinCEN’s Small Entity Compliance Guide.