Foreign Owned US Limited Liability Company

Support for Your Foreign-Owned US Limited Liability Company

Are you planning to start a foreign-owned U.S. limited liability company but need help to get your business venture off the ground while ensuring compliance? International Tax Consultants is here to help. Contact us today to learn more about our services.

Professional Tax Planning and Analysis Services

Starting a foreign-owned U.S. limited liability company can be tricky. Ensuring compliance and avoiding errors that can impact your business’s success is essential. That’s why so many foreign persons turn to International Tax Consultants for support with filing for their single-member LLCs every year.

Our team of tax advisors, accountants, and attorneys is on hand to help. We work with businesses, corporations, individuals, and other entities looking for international & multi-jurisdictional tax planning and analysis services, including both US and non-US individuals.

To get started, call us at +1 954 442-7861 or click here for information on our physical locations and e-mail addresses.

Understanding the Process of Opening a Foreign-Owned LLC

To help you better understand the process of opening a foreign-owned LLC in the United States, let’s ask and answer some of the most common questions that people and corporations have.

Can a Foreign Person Own a U.S. LLC?

The simple answer here is yes, a foreign person can own a U.S. limited liability company. The exception is for S-Corporations. 

Therefore, in order to own an LLC that is formed in the United States, it is not necessary to be a U.S. citizen, a U.S. corporation, or have a green card.

In fact, the procedure involved for a foreign corporation or citizen to form an LLC in the United States is the same as it is for someone who is a U.S. citizen.

What About Paying Taxes?

A single-member LLC, whether they are foreign-owned or not, is automatically a disregarded entity if they have not elected to be treated as a corporation. Disregarded entities do not have to pay any income taxes. Note that this is not the case in instances where the single-member LLC is generating income that is FDAP or connected to US business or trade.

What this means is that while a foreign person who owns a U.S. single-member LLC is required to fill in the appropriate forms, they aren’t losing money by doing so. However, not doing so may result in serious fines.

What Forms Must Be Completed?

Every foreign-owned single-member LLC is required to fill out a number of forms and complete a number of steps. These include:

  • Obtaining an Employer Identification Number
  • Filing pro forma Form 1120
  • Filing Form 5472 (in the case where there have been reportable transactions in the previous tax year)
  • Maintain records to support claims made on Form 5472

It is also important to note here that the IRS regards every foreign-owned disregarded LLC as a separate entity. Therefore, if you own more than one foreign-owned LLC in the United States, it is necessary to report each of these separately, otherwise, they will be subject to fines.

How Can You Get an Employer Identification Number?

In order to get an Employer Identification Number as a foreign-owned LLC, it is necessary to prepare and file a form known as SS4. Note that this form must be signed by a “responsible party”.

As defined by the IRS, a responsible party in this instance is an individual who has a level of control over, or entitlement, to the assets or funds in the entity that enables them to control, manage, or direct the entity and disposition of its funds and assets.

In the United States, an employer identification number is a nine-digit number assigned by the IRS. Its purpose is to identify the tax accounts of employers and certain others who have no employees. The number is used to identify taxpayers who are required to file various business tax returns.

Do You Need to File Form 5472?

If a single-member LLC is at least 25% foreign owned, it is necessary to file Form 5472 for all reportable transactions. Note that reportable transactions include formation and dissolution filings.

Even if a company’s amounts are small, it is necessary to report them to the IRS on Form 5472 given that there is no minimum amount before reporting.

It is important to understand the penalties that are involved if a company required to file Form 5472 does not do so. The standard fine for not filing this form is $25,000.

If the failure to file the form correctly continues for more than 90 days after notification by the IRS, an additional penalty is applied. This also stands at $25,000. If this failure continues after the 90-day period, additional fines are applied.

Click here to contact us.

Why Choose International Tax Consultants

We are here to help individuals and businesses with international & multi-jurisdictional tax planning and analysis services. As the above information highlights, it is essential that you maintain full compliance when starting a foreign-owned U.S. limited liability company, particularly given the severity of fines that may be applied.

To get started, simply fill out our online form to request a free quote. During your consultation, we will discuss your tax planning needs and answer any questions you may have about the process of establishing a foreign-owned U.S. limited liability company. You can feel confident knowing that your tax needs are in the hands of professionals.

Read Our Reviews

We are proud of our reputation as the leading tax consultants helping foreign-owned U.S. limited liability companies. Keep reading to see what some of our satisfied clients have to say about us.

“My wife and I have a wonderful professional relationship with ITC. Very satisfying and rewarding. ITChas been very patient, thorough and responsive. I recommend them to anyone seeking advise on Asset Protection, Tax and Estate Planning and Real Estate Investing”.

Foreign-Owned US Limited Liability Company Services

If you are interested in learning more about how International Tax Consultants can help your foreign-owned U.S. limited liability company, don’t hesitate to contact us today at (866) 829-4685.