John Mirkin, Esq.  

The release of the White House’s “America’s AI Action Plan” (July 23, 2025) represents an exciting development for the Artificial Intelligence (AI) industry, particularly in the United States. AI is rapidly becoming a foundational engine of innovation and productivity, underscoring the strategic importance of clear and effective national leadership.

Issued pursuant to Executive Order 14179, the Plan sets forth a structured policy framework around three defined pillars: Accelerate AI Innovation, Build American AI Infrastructure, and Lead in International AI Diplomacy and Security.

Targeted Deregulation 

Under the Innovation pillar, the administration commits explicitly to reducing “onerous regulation,” encouraging the responsible deployment of open-source and open-weight AI models, and establishing regulatory sandboxes or AI Centers of Excellence within key sectors such as healthcare, energy, and agriculture. These actions aim to clarify and streamline regulatory requirements, enabling efficient and practical deployment of advanced AI systems.

Federal Adoption, Governance, and Workforce Training 

Domestically, the Plan directs the Office of Management and Budget (OMB) to formalize the establishment of the Chief Artificial Intelligence Officer Council (CAIOC), develop a centralized federal AI procurement process managed by the General Services Administration (GSA), and ensure comprehensive workforce training programs to facilitate swift AI adoption across federal agencies.

Employer Incentive: Tax-Free AI Upskilling 

The Action Plan instructs Treasury to classify employer‑funded AI‑skills programs as tax‑free educational assistance, allowing companies to reimburse up to $5,250 per employee each year. These payments are excluded from the employee’s taxable income and remain deductible to the employer—an elegant way to spur private‑sector investment in workforce AI literacy and promote responsible adoption of the technology.

Note: The Plan currently cites I.R.C. § 132; traditional authority for tax-advantaged educational assistance is found in § 127, which would provide firmer statutory footing (though § 132’s working‑condition‑fringe rules can also apply).

Strategic Investments in American AI Infrastructure Recognizing AI’s extensive infrastructure needs, the Plan calls for accelerated permitting processes for critical facilities—including semiconductor fabrication plants, secure data centers, and related energy infrastructure—to ensure a resilient, scalable, and secure national computing environment.

Sustainability Considerations and Opportunities. While the administration explicitly signals its intention to “reject radical climate dogma” in the context of infrastructure expansion, the Plan leaves open the opportunity—and perhaps even implicitly invites—the private sector to address sustainability independently. It may thus be incumbent upon private industry to pioneer sustainable and energy-efficient AI facilities, including solar-powered or net-neutral computing campuses. Given AI’s considerable energy demands, such sustainable infrastructure could represent a strategic opportunity, delivering both environmental benefits and significant long-term cost savings.

Securing American Technological Leadership Internationally On the global stage, the Plan promotes the export of the full U.S. AI technology stack to strategic allies, tightens controls on semiconductor exports, and advocates active American engagement in international AI standards-setting bodies. Enhanced cybersecurity and biosecurity measures are also prioritized to manage emerging global risks associated with AI technologies.

Emerging Risks Unaddressed: AI-Enabled Fraud and Criminal Misuse Although America’s AI Action Plan devotes pages to cyber and bio‑security, it offers only passing reference to the fast‑growing problem of AI‑enabled fraud—deep‑fake impersonations, synthetic‑identity schemes, algorithmic market manipulation, and other criminal uses that can erode public trust and destabilize sectors from finance to healthcare. Future rule‑making will likely need to establish verifiable content‑provenance standards, mandatory incident‑reporting thresholds for critical industries, and a clear division of investigative authority among DOJ, Treasury/FinCEN, and state attorneys general. Until then, private firms and state regulators remain the first line of defense, underscoring the urgency of stronger public‑private coordination.

Key Takeaway The Action Plan articulates a clear federal strategy: accelerate innovation through targeted deregulation, invest strategically in secure national infrastructure, and reinforce American technological leadership internationally. While important implementation specifics—including funding, timelines, sustainability metrics, and measures to address emerging risks such as AI-enabled fraud—remain to be clarified, the Plan establishes a robust foundation. It sets the stage for deeper public-private collaboration, empowering both government and industry to proactively shape the next phase of American AI governance.

Status of Corporate Transparency Act

Corporate Transparency Act Update- 3/22/2025: 

On March 2, 2025, the U.S. Treasury Department announced it would suspend enforcement of the CTA's beneficial ownership information (BOI) reporting requirements for U.S. citizens and domestic reporting companies. This move effectively exempts most U.S.-formed entities from the CTA's obligations, narrowing its application primarily to foreign companies registered to do business in the United States. While the CTA remains law, its current enforcement is limited.  

It's important to note that future administrations or legislative actions could alter the CTA's enforcement landscape.  These changes are interim and subject to (i) public comment, (ii) possible court challenges, and (iii) revision by a future administration or Congress. For now, domestic businesses are relieved from the CTA's reporting requirements, but they should stay informed about potential changes in the law's application. 

Corporate Transparency Act Update - 12/24/2024: 

A lower court recently issued a nationwide preliminary injunction that halted enforcement of the Corporate Transparency Act (CTA) and its beneficial ownership information (BOI) reporting rule under 31 CFR 1010.380. However, on December 23, the Fifth Circuit Court of Appeals stayed (i.e., put on hold) that injunction, effectively reinstating the CTA’s BOI reporting requirements. FinCEN has resumed enforcement—except for companies and individuals exempted by National Small Business United v. Yellen (N.D. Ala.)—and announced new or extended filing deadlines:

Entities Created or Registered Before January 1, 2024: 

• New deadline: January 13, 2025.

Entities Formed on or After September 4, 2024, With Deadlines Between December 3 and December 23, 2024:

• New deadline: January 13, 2025.

Entities Formed Between December 3 and December 23, 2024:

• Deadline extension: 21 additional days beyond the original filing deadline.

Entities That Qualify for Disaster Relief:

• If a company qualifies for disaster relief and its extended deadline is later than January 13, 2025, it follows the later date.

Entities Created or registered on or after January 1, 2025:

• Deadline unchanged: 30 days after receiving notice of creation/registration

Although legal challenges to the CTA continue—and Congress briefly considered delaying the reporting requirement until 2026—the CTA applies as of the date of this update. FinCEN’s extensions mainly affect initial BOI filings; updated or corrected reports are still due within 30 days.

 If you are a small business owner subject to the CTA, act now to gather and submit your BOI data. With deadlines back in effect, any further legislative or legal developments remain uncertain.

Corporate Transparency Act Overview- 7/19/2023:

Background. Starting on January 1, 2024, many newly formed companies and millions of existing companies in the United States (“U.S.”) will be required to report certain personal information about their beneficial owners to the federal government for the first time. These federal reporting requirements have been set forth under the Corporate Transparency Act (“CTA”), which mandates the creation of a federal database of “Beneficial Ownership Information” (defined below) maintained by the Department of Treasury’s Financial Crimes Enforcement Network (“FinCEN”). FinCEN is developing an information technology system called Beneficial Ownership Secure System (“BOSS”), where companies will submit reports electronically.

Unlike several other countries, the U.S. does not currently have a centralized database of information about the owners and operators of legal entities within the country. Although state and local laws vary, most jurisdictions do not presently require the identification of an entity’s beneficial owners upon or after formation. The stated purpose of the CTA is to “better enable critical national security, intelligence, and law enforcement efforts to counter money laundering, the financing of terrorism, and other illicit activity.”

The goal is for this increased transparency to assist U.S. government agencies in targeting financial criminals and other bad actors operating through shell companies. For example, more than $300 billion dollars in concealed transactions is moved around the U.S. every year, according to the Federal Bureau of Investigation (“FBI”) and a U.S. Department of Treasury report.

Which Companies Will Need to Report? It is estimated that around 90% of all domestic entities will be subject to the reporting requirements. All domestic entities must report if they do not meet an applicable exemption from the reporting requirements.

Exemptions From Reporting Requirements. There is a “large operating company” exemption for companies that satisfy the following requirements:

• More than 20 full-time employees who are based in the U.S.;
• Filed federal income tax returns in the previous year showing more than $5 million in gross receipts or sales from sources within the U.S.; and
• An operating presence at a physical office in the U.S.

There are also exemptions for companies that operate in certain heavily regulated industries. These exempted industries include but are not limited to publicly traded registered issuers of securities, registered investment advisors, registered investment companies, registered broker-dealers, banks, public utilities, credit unions, governmental authorities, 501(c)(3), and political organizations, exchange and clearing agencies, insurance companies, and certain business concerns affiliated with State or Indian Tribes.

Subsidiary companies that are wholly owned or controlled, either directly or indirectly, by most exempt entities will also be exempt from the reporting requirements. The exemption for subsidiaries will not apply to pooled investment vehicles, certain tax-exempt entities, and money service businesses.

Timing of Reporting.  The reporting requirement will be immediate (within 30 days after formation) for entities that are formed after January 1, 2024. Existing entities will have one year (until January 1, 2025) to file the report with FinCEN.

What is the Penalty for Not Reporting?  The CTA provides significant penalties for failing to file a report or providing false information. These penalties include monetary fines of up to $10,000, two years in prison, or both. Fines may be up to $500 each day that the report is late (capped at $10,000).

What Information Must be Reported? The CTA requires that each reporting company must report certain information regarding the beneficial owners of the reporting company. This information is known as “Beneficial Ownership Information” (“BOI”). Companies will also need to report similar information about the person(s) who formed the entity (the “applicant”). Specifically, each beneficial owner and each applicant will be required to report:

• Full legal name
• Date of birth
• For an applicant who registers companies as a part of the applicant’s business, such as a professional advisor, the complete address of the applicant’s business, and in all other cases, the individual’s residential address
• Unique identifying number, such as from a passport, driver’s license, or state-issued ID number
• An image of the document used for identification

Who is a Beneficial Owner? Generally, a beneficial owner is defined as any individual who, directly or indirectly:

• Owns or controls at least 25% of the reporting company; or
• Exercises “substantial control” over the reporting company.

Factors indicating substantial control include:

• A position as a senior officer of a reporting company
• Authority over the appointment or removal of any senior officer
• Direction, determination, or substantial influence over important decisions made by the reporting company, including the sale, lease, or transfer of any principal assets of the reporting company; the entry into or termination of significant contracts, major expenditures, investments by the company, compensation schemes for senior officers, etc.)

There is also broad catch-all language in the CTA, providing that “any other form of substantial control over the reporting company” is included.

Expedited Annual Reporting for Owners and Applicants: FinCEN Identifiers. According to FinCEN, applicants and beneficial owners will be able to apply for and obtain “FinCEN identifiers” by submitting their BOI to FinCEN. Once approved and issued a FinCEN identifier, beneficial owners and applicants would then report their FinCEN identifier (instead of their BOI), which would link to the BOI they had provided and make reporting easier for individuals who frequently serve as applicants or individuals who are the beneficial owners of multiple entities.

FinCEN is still developing the BOSS system, which will process and store the information that companies will be required to report. Our firm is monitoring guidance from FinCEN as it continues to develop. In the meantime, companies, business owners, and their advisors should proactively determine whether these reporting requirements are applicable or if an exception can be met. Entities that will be required to report should identify beneficial owners and prepare to request the necessary BOI from them.    

For assistance with managing your CTA filings or to have us handle the reporting process on your behalf, please contact us—we’re here to help streamline compliance for your business.