The United States' company rules: quick facts
- Entity
- Single-member LLC owned by a non-US person (Wyoming, Delaware, New Mexico, Florida)
- Tax model
- Pass-through, 0% Source: irs.gov, checked September 29, 2026. IRS (page updated July 27, 2026): an LLC with one member is disregarded as separate from its owner for income tax unless it elects corporate treatment on Form 8832, and its activities go on the owner's return. There is no entity-level federal income tax. A C-corporation pays 21% federal tax on its taxable income (26 USC 11(b), read September 29, 2026 at law.cornell.edu/uscode/text/26/11)Headline corporate tax rate
- Tax on $100,000 of profit paid out to a non-resident owner
- 0% Source: irs.gov, checked September 29, 2026. Same as retained: the LLC is disregarded, so taking money out is not a dividend and triggers no US tax. The owner's residence country taxes the profit whether or not it is paid out
- Formed without visiting
- Yes
- Stripe available
- Yes Source: stripe.com, checked September 29, 2026. Stripe Atlas also forms Delaware LLCs and C-corporations
- Bank or EMI account
- Good
- Audit required
- No
- EU list of non-cooperative jurisdictions
- Not listed Source: data.consilium.europa.eu, checked October 12, 2026
- FATF grey list
- Not listed Source: data.consilium.europa.eu, checked October 12, 2026
- Economic substance rules
- No
LLC or C-corporation: which US company a non-resident forms
The usual choice for a non-US freelancer or solo founder is a single-member LLC. None of the 4 states in the cost box has a residency or nationality rule for members or managers, 1 member is enough, and the only local requirement is a registered agent with a physical address in the state.
The state decides the running cost and what the public record shows, not the federal tax. Wyoming's minimum annual license tax is $60 and Delaware's annual LLC tax is $400, so over 5 years a Delaware LLC costs $1,700 more to keep for the same result. Wyoming, New Mexico and Delaware filings do not have to name the owner, while Florida's public record names a manager or authorized member.
A Delaware C-corporation is a separate taxpayer paying 21% federal corporate tax, and its dividends to a foreign owner bear 30% US withholding unless a tax treaty lowers it. Paid out in full with no treaty, $100,000 of profit loses $21,000 to corporate tax and $23,700 to withholding, 44.7% before your home country looks at it. That structure is for founders raising US venture capital, not for a freelancer taking profit out.
How the US taxes a non-resident's LLC
By default the IRS disregards a single-member LLC as separate from its owner for income tax: the LLC pays no entity-level tax and its profit is treated as yours, unless you elect corporate treatment on Form 8832.
As a foreign owner, you owe US income tax only on income effectively connected with a US trade or business. Personal services performed while you are physically in the US usually count when they are considerable, continuous and regular. A service business run entirely from outside the US, with no US office, has none, so US tax on $100,000 of profit is $0. Taking the money out is not a dividend in a disregarded LLC, so no withholding applies either.
The US has no VAT, and state sales tax needs nexus in a state, which services sold to clients abroad do not create. Your country of residence may still want you registered for VAT if the business is carried on from there.
David's note
I would settle how your country of residence classifies a single-member LLC before choosing a state. The state moves your yearly bill by $340 at most between Wyoming and Delaware; the classification decides whether the profit is taxed once as your own business income or pulled into CFC rules as a foreign company's profit. When the answer is "a foreign company", the LLC loses the simplicity that was the reason to form it.
Cost and timeline to set up in the United States
Official fees come from the government or registry schedule. Market ranges cover formation and yearly upkeep through a provider, including a registered agent and filings. Timeline: The state filing takes 1 to 5 business days online. The EIN is the slow step: an owner with no SSN or ITIN cannot use the IRS online tool and applies by phone, fax or mail, which can take several weeks.
How to form a US LLC from abroad, step by step
Nothing in the process needs a trip to the US. The state filing is online in all 4 states in the cost box, the EIN comes by phone, fax or mail, and only a traditional branch bank is likely to ask you to come in person.
Forming a US LLC as a non-resident
- Choose the state and a registered agent. The agent needs a physical address in that state; its address goes on the public filing and it receives legal papers for the LLC.
- File the articles of organization online (a certificate of formation in Delaware) with the LLC's name, the agent's details and an organizer. Online filings take 1 to 5 business days.
- Sign a single-member operating agreement naming you as the only member, and keep it with the filed articles as the record of who owns and runs the LLC.
- Apply for the EIN on Form SS-4. Without an SSN or ITIN the online tool is closed to you, so call the IRS international line on 267-941-1099 (Monday to Friday, 6 a.m. to 11 p.m. Eastern) or fax or mail the form, which can take several weeks. The EIN itself is free.
- Open the business account with the filed articles, the EIN letter and your ID.
- Diary the yearly filings before the first one falls due: Form 5472 every April and the state charge in the table below.
The LLC has no nationality test for its owner, but once formed it is a US person for sanctions purposes: OFAC requires all US-incorporated entities to comply with US sanctions. An owner who lives in a country under US sanctions should expect US banks and fintechs to refuse the account.
There is no beneficial ownership report to file and no public register of owners. FinCEN exempted companies created in the US from reporting on March 26, 2025, and a final rule made the exemption permanent from August 14, 2026; only foreign companies registered to do business in a state still report.
US LLC annual filings and deadlines
A non-resident's LLC owes paperwork every year even when it owes no US tax. The federal filing is the same in every state; the state charge depends on where you formed.
Yearly filings for a single-member LLC owned by a non-US person, calendar tax year
| Filing | Filed with | Deadline | Cost of missing it |
|---|---|---|---|
| Form 5472 attached to a pro forma Form 1120 | The IRS, by fax or mail only (no e-filing) | April 15; Form 7004 extends it | $25,000 per failure, plus $25,000 for each 30 days it continues beyond 90 days after an IRS notice |
| Wyoming annual report and license tax ($60 minimum) | Wyoming Secretary of State | First day of the month the LLC was formed in | Dissolution if not paid within 60 days of the due date |
| Delaware annual LLC tax ($400) | Delaware Division of Corporations | June 1 | $200 penalty plus 1.5% interest a month on tax and penalty |
| Florida annual report ($138.75) | Florida Division of Corporations | May 1 | The fee rises to $538.75 |
| Your own tax return, with the LLC's profit on it | The tax authority where you live | Your country's deadline | Your country's penalties and the tax itself |
Opening a US bank account for a non-resident LLC
US fintech business accounts are the realistic route for a non-resident owner: they open online with the formation documents, the EIN letter and your ID. Traditional US banks usually want you in a branch, so they suit an owner who already has a US trip planned.
Expect questions about where you live, what the LLC sells and who pays it. Fintechs refuse founders who live in the countries on their restricted lists, some expect a US connection, and an account opened while you lived in one country can be closed if you move to a country on that list.
The US reports accounts under FATCA and has not joined the OECD Common Reporting Standard, but that does not keep the LLC out of sight at home. An account the LLC holds at a bank or fintech outside the US is usually treated as a passive entity's account, and you are reported to your country of residence as its owner.
Every account opening also asks for your tax residence on a self-certification form, and "none" is the answer that stalls onboarding. That form, more than any tax rule, is the practical limit on running a US LLC with no tax residence anywhere.
Where a US LLC's profit is really taxed
The $0 US tax is real, but it only moves the question to the country where you live. At $100,000 of profit from client work, this is where the tax lands in the 5 situations owners actually end up in.
Tax on $100,000 of LLC profit by owner situation (US column from the IRS rules above)
| Owner situation | US tax | Where the profit is taxed |
|---|---|---|
| Lives in a country that treats the LLC as transparent | $0 | Your country, as your own business income at its personal rates, often with social security on top |
| Lives in a country that treats an LLC as a foreign company | $0 | Your country, through its CFC rules or as company profit, with a risk of the same profit being taxed twice |
| Lives in Paraguay and works from there | $0 | Paraguay, because work done while living there is Paraguayan-source even when the clients are abroad |
| Has no tax residence anywhere | $0 | No country claims it on paper, and bank checks and CRS forms become the problem |
| Works from inside the US for long stretches | Graduated rates on the effectively connected part, filed on Form 1040-NR | The US, and the country of residence as well |
The cheapest version that holds up pairs the LLC with a residence that taxes the owner lightly, such as living in Paraguay with a US LLC, where the US takes nothing and Paraguay taxes the work done there at its own personal rates.
Form 5472 is the expensive mistake
An LLC with no US income still files Form 5472 with a pro forma Form 1120 every year, reporting its transactions with you, including the money you put in to form it and every distribution you take out. The IRS penalty is $25,000 for each failure, and more if it runs on after a notice. It cannot be e-filed: you fax or mail it, with "Foreign-owned U.S. DE" written across the top of the Form 1120.
A non-resident's US LLC, set up right and wrong
Works
You live in 1 country, you have confirmed it treats a single-member LLC as transparent, you report the profit on your own return there, and you fax Form 5472 every April, including the year the LLC had no US clients.
Fails
You formed the LLC because it pays no US tax, you report nothing where you live, you skip Form 5472 because there is no US income, and you spend 4 months a year working from a rented apartment in Miami.
