Reference
Glossary
The terms that come up when you build and run a US company from abroad, in plain language. Each links to the service that handles it.
- EIN
- A nine-digit tax ID the IRS issues to a business, used to open bank accounts, file taxes, and hire. A non-resident can obtain one without a Social Security Number.
- Prodezk handles EIN registration
- ITIN
- A tax-processing number the IRS issues to individuals who must file US taxes but are not eligible for a Social Security Number, including many non-resident owners.
- Prodezk handles ITIN application
- Form 5472
- An IRS information return a foreign-owned single-member US LLC must file every year to report transactions with its owner. Failing to file carries a penalty that starts at $25,000.
- Prodezk handles income tax filing
- BOI Report
- A filing with FinCEN that identifies who ultimately owns or controls a company. The rules shifted in 2026; whether a US entity must file now depends on its specific situation.
- Prodezk handles BOI reporting
- FIRPTA
- A US tax rule requiring the buyer to withhold a percentage of the sale price when a foreign person sells US real estate, held against the seller's potential US tax on the gain.
- Prodezk handles tax services
- Franchise Tax
- A recurring fee some states charge for the privilege of being registered there, owed regardless of income or activity. Delaware, California, and others bill it every year.
- Prodezk handles annual compliance
- Registered Agent
- A person or company with a physical address in the state, designated to receive legal and government mail for a business. Every US entity is required to maintain one.
- Prodezk handles registered agent service
- Operating Agreement
- The internal document that sets out how an LLC is owned and run: its members, ownership split, management, and how profits are shared. Banks and partners often request it.
- Prodezk handles operating agreements
- Annual Report
- A periodic state filing that keeps a company's registration current, confirming basics like its address and registered agent. Missing it puts the company's good standing at risk.
- Prodezk handles annual report filing
- FBAR
- A US Treasury report required when someone with US tax obligations holds foreign financial accounts above a threshold. It discloses the accounts; it is a report, not a tax.
- Prodezk handles tax compliance
- Effectively Connected Income
- Income a foreign person earns that is connected to a US trade or business. ECI is taxed at regular graduated US rates on a net basis, after allowable deductions.
- Prodezk handles income tax
- FDAP Income
- Passive US-source income such as interest, dividends, or royalties paid to a foreign person. It is generally taxed at a flat 30% withholding unless a tax treaty lowers the rate.
- Prodezk handles income tax
- Tax Treaty
- An agreement between two countries that reduces double taxation, often by lowering withholding rates. Most Latin American countries do not have an income tax treaty with the US.
- Prodezk handles tax services
- Good Standing
- A status confirming a company has met its state filing and fee obligations. A Certificate of Good Standing is often required to open accounts, expand to new states, or sell.
- Prodezk handles good standing certificates
- Charging Order
- The limited remedy a creditor of an LLC member generally gets: a claim on that member's distributions only, not the company's assets or control. It is central to why LLCs protect assets.
- Prodezk handles LLC formation