Jefferson Reporter

U.S. Senators Katie Britt and Tim Scott have introduced the Protect Small Businesses from Excessive Paperwork Act of 2025, aimed at alleviating the administrative burdens faced by small businesses due to new reporting requirements. The proposed legislation seeks to extend the deadline for businesses to report beneficial ownership information (BOI) until January 1, 2026. This extension would provide additional time for the U.S. Department of Treasury to educate business owners about these requirements and assess related decisions made by the Biden administration.

Senator Britt emphasized the importance of small businesses in Alabama, stating, "Alabama’s small businesses do more than just keep our state running — they employ our friends and neighbors, provide invaluable goods and services, and make our communities and state so special." She described the legislation as a means to reduce unnecessary regulations while offering clarity to job creators nationwide.

The bill was co-introduced with support from Banking Committee members Mike Rounds, Thom Tillis, Bill Hagerty, Cynthia Lummis, Pete Ricketts, Jim Banks, and Kevin Cramer. Additional backing came from Senators Jerry Moran and James Lankford. In parallel, Representative Zach Nunn led companion legislation in the House that passed unanimously with a vote of 408-0.

Chairman Scott highlighted the role of small businesses in the economy: “Small businesses are the backbone of our economy, and we need to ensure they have the necessary time and information to comply with reporting requirements from the federal government."

The Corporate Transparency Act established new BOI reporting obligations as part of the Fiscal Year 2021 National Defense Authorization Act. However, implementation challenges arose when FinCEN failed to adequately inform small businesses about these changes. A survey by NFIB indicated that 80% of its members were unaware of these requirements. The NSBA reported that compliance could cost small business owners nearly $8,000 in their first year.

Despite efforts to block enforcement through legal channels, including a recent Supreme Court decision on January 23, 2025, requiring immediate compliance remains a pressing issue for many small enterprises across America.

Senator Britt continues her advocacy for small business interests by opposing what she views as detrimental regulatory proposals from federal financial regulators. She also cosponsored Senator Steve Daines’ Main Street Tax Certainty Act this week to solidify tax deductions favorable to smaller entities.