LLC for Non-U.S. Residents

An LLC for non-U.S. residents is a limited liability company in the United States that can be owned and operated by individuals or entities from outside the country, providing a flexible structure for doing business in the U.S.

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As a non-U.S. resident, starting a business in the United States can seem like a daunting task. However, with the right knowledge and support, it’s possible to form an LLC and achieve your entrepreneurial goals. In this article, we’ll explore the requirements and steps involved in starting an LLC as a non-U.S. resident, as well as taxation considerations. 

Can a non-U.S. citizen have an LLC?

Yes, non-U.S. citizens can form and own LLCs in the United States. This includes foreign individuals, corporations, and other entities. However, there are certain legal and visa requirements that must be met in order to form an LLC as a non-U.S. resident.

Requirements for Non-U.S. Residents to Start an LLC in the USA

Legal Requirements for Foreign-Owned LLCs in the USA

Foreign-owned LLCs in the USA must comply with federal and state laws, as well as any specific regulations related to their industry or location. This includes obtaining a tax identification number, registering with relevant state agencies, and maintaining proper business licenses and permits.

Visa and Residency Requirements for Non-U.S. Residents to Form an LLC in the USA

Non-U.S. residents who wish to form an LLC in the USA must have a valid visa that allows for business activities, such as an E-2 visa or L-1 visa. Alternatively, they can form an LLC as a passive investor without needing a visa. Some states also require LLC owners to have a U.S. address and phone number.

State-Specific Requirements and Regulations for Forming an LLC as a Non-U.S. Resident

Each state has its own specific regulations and requirements for forming an LLC, which can vary depending on the state’s business laws and tax codes. For example, some states may require LLCs to have a registered agent who is a resident of that state.

Obtaining a U.S. Business Address as a Non-Resident

If you’re a non-resident looking to start an LLC in the U.S., you’ll need to provide a U.S. business address when registering your business with the state. This can be a challenge if you don’t have any physical presence in the U.S. Fortunately, there are several options available to non-residents who need a U.S. address for their LLC.

One option is to use a registered agent service that provides a business address for your LLC. A registered agent is a third-party service that receives legal and official documents on behalf of your LLC, and many of these services also offer a U.S. business address as part of their package. Using a registered agent not only provides you with a U.S. business address, but it also helps ensure that you never miss important legal or official documents sent to your LLC.

Another option is to use a virtual office service that provides a physical address for your LLC. Virtual office services offer a range of features, including a physical mailing address, mail forwarding, and the use of conference rooms and office facilities as needed. While this option may be more expensive than a registered agent service, it can provide you with more of a physical presence in the U.S. and may be a good choice if you plan to conduct business in the country.

Regardless of which option you choose, it’s important to have a U.S. business address to help ensure that your LLC is registered properly and to avoid any potential legal issues down the line.

Starting an LLC as a Foreigner

Step 1: Pick a U.S. state to form an LLC

The first step in starting an LLC as a foreigner is to choose the state where you want to form your LLC. This can depend on a variety of factors, such as the state’s business laws, tax rates, and location.

Step 2: Name your LLC

Once you’ve chosen your state, you need to come up with a name for your LLC. The name must be unique and not already in use by another business in that state.

Step 3: Choose a registered agent

LLCs must have a registered agent, which is a person or entity that is responsible for receiving legal documents (such as notices of lawsuits against the business) and other important communications on behalf of the LLC. Some states require the registered agent to be a resident of that state.

Step 4: File Articles of Organization

The Articles of Organization (sometimes called the Certificate of Formation) is a legal document that officially forms your LLC. This document must be filed with the state where you’re forming your LLC, along with any necessary fees.

Step 5: Get an operating agreement

An operating agreement is a legal document that outlines the ownership structure, management, and operating procedures of your LLC. While not all states require an operating agreement, it’s still a good idea to have one in place.

Step 6: Apply for an EIN and review tax requirements

Once you have completed the previous steps, the next step is to apply for an EIN (Employer Identification Number). This is a unique nine-digit number that the IRS assigns to businesses for tax purposes. As a non-U.S. resident, you can apply for an EIN through the IRS website, by mail, fax, or by phone.

To apply for an EIN as a foreigner, you will need to complete Form SS-4, which is the application for an EIN. When filling out the form, be sure to include your foreign address in the appropriate section, and make sure you have all the necessary information on hand, such as your LLC’s name, your name and Individual Taxpayer Identification Number (more on how to obtain this below), and the name and address of your registered agent.

It’s important to note that even if you don’t plan to hire employees, you may still need an EIN for tax purposes, such as opening a business bank account, filing tax returns, and applying for certain business licenses and permits. Also, any LLC with more than one owner is required to have an EIN.

Before applying for an EIN, it’s important to review the tax requirements for non-U.S. residents and consult with a tax professional. You may be subject to federal and state taxes, and certain tax treaties between the U.S. and your home country may impact your tax obligations. Additionally, you may need to file additional forms such as Form 5472, which is required for foreign-owned LLCs.

Individual Taxpayer Identification Number (ITIN) for Non-U.S. Residents

If you’re a non-U.S. resident looking to start an LLC in the United States, you likely don’t have a Social Security number. So, in order to complete Form SS-4, you may instead need to apply for an Individual Taxpayer Identification Number (ITIN) to fulfill your tax obligations. An ITIN is a tax processing number issued by the Internal Revenue Service (IRS) to individuals who are required to have a U.S. taxpayer identification number but don’t have, and aren’t eligible to obtain, a Social Security number (SSN) from the Social Security Administration (SSA).

To apply for an ITIN, you’ll need to complete Form W-7, Application for IRS Individual Taxpayer Identification Number, and submit it to the IRS along with your tax return, or another approved reason for needing an ITIN. It’s important to note that an ITIN isn’t a substitute for an SSN and can’t be used for employment purposes.

LLC Taxation for Non-U.S. Residents

One of the benefits of forming an LLC in the U.S. is the flexibility it offers regarding taxation. By default, an LLC is considered a pass-through entity for tax purposes, which means that the profits and losses are reported only on the owner’s personal tax return without first being taxed at the business level. This can result in lower taxes for some foreign business owners. However, tax requirements and regulations can vary depending on your country of residence, the state where your LLC is located, and other factors. It’s important to consult with a tax professional to determine your tax obligations and options.

We can help!

Starting a business as a foreigner in the U.S. can be a complex process, but ZenBusiness is here to help make it easier. Our platform provides all the tools and resources you need to form your LLC, including registered agent services, an operating agreement template, and EIN registration. With ZenBusiness, you can get started today for $0, with all the support needed to hit the ground running and focus on your business.

Disclaimer: The content on this page is for informational purposes only, and does not constitute legal, tax, or accounting advice. If you have specific questions about any of these topics, seek the counsel of a licensed professional.

Non-U.S. Resident LLC FAQs

  • The state that’s best for an LLC for a non-resident depends on several factors, such as tax laws, ease of formation, and state-specific regulations. Some of the popular states for LLC formation are Delaware, Wyoming, and Nevada. However, it’s important to consult with a legal professional or an expert in LLC formation to determine the best state for your specific needs as a non-resident.

  • Yes, non-residents can open a business in the USA. However, there are specific legal requirements that non-residents must comply with, such as obtaining a visa or residency status and fulfilling state-specific regulations for LLC formation. Non-residents may also need to appoint a registered agent to represent their LLC in the state where the business is formed.

  • While an LLC can’t directly sponsor a green card for an individual, an LLC may hire an individual who holds a green card or other valid work authorization to work for the LLC. The individual’s work authorization status must be verified before hiring. The LLC may also support an individual’s application for a green card or other work authorization, but the application must be submitted and processed by the appropriate government agency.

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