Corporate Transparency Act Reporting Requirements Eliminated for Community Association Boards
A major federal regulatory change provides long-awaited relief for homeowners associations, condominium associations, and the volunteer board members who serve them.
What Happened?
On August 11, 2026, the U.S. Department of the Treasury’s Financial Crimes Enforcement Network, commonly known as FinCEN, issued a final rule eliminating Corporate Transparency Act beneficial ownership reporting requirements for U.S. companies and U.S. persons.
That exemption includes U.S.-based community associations and their volunteer board members.
A Significant Change for HOAs and Condominium Associations
The Corporate Transparency Act was originally enacted as part of a broader federal effort to combat money laundering and the use of anonymous business entities for illegal financial activity.
However, because many homeowners associations and condominium associations are incorporated entities, questions quickly arose over whether community associations and their volunteer board members would also be required to comply with the law’s beneficial ownership reporting requirements.
That created understandable concern throughout the community association industry. Volunteer board members potentially faced requirements to provide personal identifying information to a federal database simply because they had agreed to serve their neighborhood or condominium community.
The new FinCEN rule resolves that issue for U.S. associations and U.S. persons.
What the New Rule Means
U.S. companies and U.S. persons, including community association board members, are exempt from beneficial ownership information reporting requirements.
U.S. persons who previously obtained a FinCEN identifier will not be required to update or correct information previously supplied to FinCEN.
FinCEN has announced that it will implement a process to delete qualifying beneficial ownership information previously submitted by U.S. persons.
Volunteer directors should no longer have to provide personal information simply because they serve on the board of a domestic community association.
There’s an Important Distinction: The CTA Still Exists
The FinCEN rule does not repeal the Corporate Transparency Act.
Instead, the Treasury Department has used its regulatory authority to change how the law applies, exempting U.S. companies and U.S. persons from the beneficial ownership reporting requirement.
The Corporate Transparency Act itself remains part of federal law unless Congress passes legislation repealing it and that legislation is enacted.
Why CAI Is Still Asking Congress to Act
The Community Associations Institute has spent several years advocating on behalf of community associations and volunteer board members regarding the Corporate Transparency Act.
According to CAI, volunteer homeowners serving nonprofit and community association corporations were never the type of individuals the law was intended to target.
CAI therefore continues to support congressional legislation that would repeal the Corporate Transparency Act altogether.
What Is H.R. 425?
H.R. 425, known as the Repealing Big Brother Overreach Act, would repeal the Corporate Transparency Act rather than relying on an administrative exemption.
The legislation was introduced in the U.S. House of Representatives and, according to CAI’s August 2026 advocacy update, was approved by the House Financial Services Committee in April 2026.
CAI is encouraging community association board members, homeowners, managers, and other industry professionals to contact their representatives and support the legislation.
Does My Association Need to File Anything?
For a typical U.S.-created homeowners association or condominium association governed by U.S. persons, the new FinCEN rule means the association and its volunteer board members are not subject to the CTA’s beneficial ownership reporting requirement.
Associations should nevertheless maintain normal corporate and governance records and remain aware of future legislative or regulatory changes. Associations with unusual ownership structures, foreign entities, or other circumstances should consult qualified legal or tax counsel regarding their particular situation.
Learn More & Take Action
The Community Associations Institute is continuing its federal advocacy efforts and is encouraging community association leaders to support congressional repeal of the Corporate Transparency Act.
Read CAI’s Full Update Contact Congress Through CAI View H.R. 425What Board Members Should Take Away From This
For community association boards, this is primarily good news. The uncertainty surrounding whether volunteer directors would be required to provide personal information to FinCEN has largely been resolved through the new rule.
Board members should not confuse the new exemption with congressional repeal, however. The underlying Corporate Transparency Act remains federal law, which is why industry advocacy regarding H.R. 425 continues.
Associations should continue relying on reputable industry resources, professional management, legal counsel when appropriate, and official government guidance when federal requirements change.
Stay Informed. Stay Compliant.
Community association governance continues to become more complex, particularly as federal and state requirements evolve. Professional management can help boards stay informed, maintain proper records, understand changing requirements, and focus on making sound decisions for their communities.
Blackstone Management
Professional Community Association Management
www.blackstoneAM.com
This article is based in part on information published by the Community Associations Institute and publicly available information from the U.S. Department of the Treasury and Financial Crimes Enforcement Network. Information is provided for general educational purposes and should not be considered legal or tax advice. Associations with questions regarding their individual circumstances should consult qualified legal or tax counsel.
