Tax in the USA: Complete Guide to Federal, State & Corporate Tax Rates
November 26, 2025
English
.svg){kind=icon}
Forming a US limited liability company (LLC) as a non-resident is a straightforward path for foreign founders who want access to the US market while protecting personal assets and keeping operational flexibility. This guide walks you through what an LLC means for international owners and the essential steps—picking a state, naming a registered agent, filing Articles of Organization, creating an Operating Agreement, and getting an EIN—explaining why each step matters for cross-border business. Many founders choose an LLC to secure predictable legal standing, connect to US payment processors, and simplify contracting with US partners. Throughout, you’ll find a practical comparison of Delaware, Wyoming, and Nevada, a step-by-step checklist for non-citizens, guidance on remote banking and EIN procedures, and current compliance priorities such as BOI/FinCEN and Form 5472, updated through 11/2025.
An LLC gives you a legal structure that separates personal assets from business liabilities and makes it easier to operate with US customers and platforms. It pairs limited liability with flexible tax options, which lowers personal exposure and streamlines revenue handling for e-commerce, SaaS, consulting, and investment activities. For many international entrepreneurs, this also improves credibility with US partners, eases onboarding with payment processors, and opens a clearer path to US bank accounts and contracts. Knowing these practical benefits helps you decide whether an LLC fits your business and risk profile before you compare entity types and formation steps.
What tangible advantages make an LLC attractive to foreign founders? Below are the most common reasons international businesses register in the United States.
These benefits often make an LLC the preferred choice because it combines legal protection, operational simplicity, and tax options. Next we compare LLCs with corporate forms to clarify when an LLC is the better fit.
An LLC pairs liability protection with flexible governance and tax treatment, making it a practical choice for foreign entrepreneurs who want to limit personal risk while selling into the US. An LLC shields owners from business debts and can be run as owner-managed or manager-managed, which fits single founders and small teams. For example, an e-commerce operator can keep bookkeeping simpler than a C-corporation, and a consultant can contract with US clients without the overhead of a full corporate structure. These advantages support faster market entry, smoother integration with US platforms, and lower administrative friction for international founders.
Those benefits lead into the next comparison between LLCs, C-corporations, and S-corporations for non-resident owners.
LLCs differ from C-corporations mainly in tax flexibility and administrative burden. LLCs typically allow pass-through taxation, while C-corps are taxed at the entity level unless elections change that; this distinction matters for foreign owners because of withholding rules and tax residency issues. S-corporations are generally not available to non-resident aliens because of strict shareholder eligibility, so most international founders choose between an LLC and a C-corp. Administratively, LLCs usually require fewer formalities (no mandatory boards or meetings), which lowers costs and complexity for remote owners. Understanding these differences helps you choose the right entity based on fundraising plans, investor expectations, and long-term tax goals.
Forming an LLC as a non-resident follows a sequence of state and federal steps to create the legal entity, name it, appoint a registered agent, document internal rules, and secure tax identification. The core process is a state-level filing followed by federal tax registration and practical setup tasks like banking and merchant onboarding. Common friction points for non-residents are state selection, appointing a registered agent, and identity verification for banking and EIN issuance; preparing for these ahead of time reduces delays. Below are the main steps with practical notes and a state comparison to guide your choice.
These steps map to the common hurdles non-residents face; the sections that follow unpack state choice, naming and filings, registered agent requirements, Operating Agreements, and obtaining an EIN in plain terms. Formation and compliance providers can help with filings and ongoing representation where needed.
State choice is a balance between filing and annual fees, owner privacy, and tax rules. Delaware is widely used for its predictable corporate law and investor familiarity; Wyoming is attractive for low fees and owner privacy; Nevada emphasizes privacy and business-friendly statutes. The differences come down to state law—Delaware’s Chancery Court gives legal clarity for complex deals, Wyoming allows greater anonymity and low ongoing costs, and Nevada offers privacy plus favorable fee structures for certain businesses. In practice: pick Delaware if you expect US investors or complex agreements; choose Wyoming for privacy and low recurring costs; choose Nevada if you want strong statutory privacy and minimal state oversight. Match your selection to your business model, sales nexus, and investor plans.
This table simplifies the decision. Your final choice should also account for where sales create nexus and the ongoing costs of a registered agent and annual reports—those factors often shape long-term expenses.
LLC names must follow state rules: include a designator like "LLC" or "Limited Liability Company," avoid restricted words (for example "bank" or "insurance" without licenses), and be unique in the state registry. Filing means submitting Articles of Organization to the Secretary of State with details such as the company name and the registered agent’s name and address; some states also request organizer information. Fees and processing times vary. Practical tips: run a state name availability search, reserve the name if needed, and consider a DBA for alternate brand names—these steps reduce rejection risk and protect your brand. For non-residents, decide in advance how you’ll sign and deliver paperwork (electronic signatures, mail, or via a formation service).
Filing Articles is usually a single interaction with the state and many states offer expedited processing. Next we explain why a registered agent is required and how to appoint one remotely.
A registered agent is a person or company with a physical street address in your state of formation designated to receive official and legal notices for the LLC. Every state requires one to ensure the entity can be served and contacted. For non-residents, a commercial registered agent is common: they accept service, forward documents, and send compliance reminders—avoiding the need to use a friend’s address and keeping owner addresses off public records. Many registered agent providers also offer dashboards that help with annual reports and document retrieval, which is especially useful when you manage the business remotely.
When choosing an agent, confirm they accept service in your state and provide secure document transmission. Providers that bundle formation and registered agent services simplify post-formation administration.
An Operating Agreement is the LLC’s internal governance document: it records ownership percentages, management roles, how profits are distributed, voting rules, and transfer restrictions. Even where not legally required, it clarifies member rights and helps show the LLC is a distinct entity for legal and tax purposes—important for multi-member ventures.
Essential clauses include:
Drafting tips:
An Employer Identification Number (EIN) is the IRS tax ID used for payroll, bank accounts, and tax filings—most LLCs need one, and non-residents usually must obtain it even without US employees. Foreign applicants typically complete Form SS-4; if no owner has an SSN or ITIN, you may need to call the IRS or use an authorized third-party designee to get the EIN by phone or fax. Common routes include working with a formation provider that files for you or submitting SS-4 by mail or fax; online EIN issuance is often limited to applicants with a US taxpayer ID. Typical obstacles are identity verification and lacking a US phone number or representative—formation services can handle paperwork and follow up with the IRS to reduce friction.
Obtain the EIN before you apply to open a bank account—most US banks require it.
After formation, the focus shifts to operations and compliance: opening a US business bank account, meeting federal and state tax obligations (including BOI/FinCEN reporting), and filing annual state reports and franchise taxes where required. Ongoing compliance keeps your LLC in good standing and avoids penalties that could block banking, contracts, or payment processors. For non-residents, continuity through a registered agent, disciplined bookkeeping, and timely filings lowers the risk of administrative dissolution or enforcement actions. The sections below cover remote banking, tax filings such as Form 5472 and Pro Forma 1120, and a practical cadence for annual reports and BOI submissions.
Proactive management preserves the LLC’s legal benefits and makes it easier to do business with US counterparties.
Opening a US business bank account remotely is possible via several channels: fintech providers with international onboarding, US banks that accept remote verification with introductions, or in-person account opening during a US visit. Banks commonly require your Articles of Organization, Operating Agreement, EIN, passports or government IDs for beneficial owners, and proof of address; exact requirements vary and some banks may ask for additional verification. To avoid rejections, present clear ownership documents, prepare notarized or apostille-certified papers if requested, and consider banks experienced with international clients or fintech partners. Formation services often prepare a standardized document packet and introduce clients to bank partners, which can significantly reduce friction.
Use this checklist to prepare and avoid wasted applications:
These items typically meet onboarding needs and increase your chance of remote bank account approval.
Foreign-owned LLCs must handle a mix of federal filings and potential state registrations depending on nexus and operations. Key federal items include Form 5472 for reportable transactions with related foreign parties, preparing Pro Forma Form 1120 when filing triggers apply, and completing BOI/FinCEN beneficial ownership reporting. The goal of these requirements is transparency and correct withholding: the IRS and FinCEN need records linking transactions to beneficial owners and to ensure withholding is handled properly. Maintain a compliance calendar and consult a tax professional when needed—cross-border filings can be complex.
Taxation of US LLCs with Foreign Participation and Non-Resident Members
This analysis applies core international tax principles—residence, source rules, treaty application, and the concept of permanent establishment—to the taxation of non-resident members of a U.S. LLC. It also addresses the LLC’s withholding obligations.
Timely filings and thorough records prevent penalties and protect the LLC’s standing; non-residents should build a compliance calendar and get professional tax help where appropriate.
Ongoing compliance means filing required state annual reports, paying franchise taxes where applicable, and submitting Beneficial Ownership Information (BOI) to FinCEN as required. These obligations create administrative transparency: states keep public records, and FinCEN collects beneficial ownership data to combat illicit finance. Best practices include quarterly compliance reviews, keeping a corporate minute book with current ownership documents, and using a registered agent to receive state notices and deadline reminders. For remote owners, consolidating compliance with a single provider reduces errors and creates a reliable record for audits and banking.
A simple cadence—quarterly document checks, one annual report filing, and immediate BOI updates after ownership changes—keeps the LLC in good standing and minimizes surprises.
Prodezk is a business formation and compliance partner focused on entrepreneurs and investors from Latin America and other international markets. We offer guaranteed professional support, multilingual assistance in English, Spanish, and Portuguese, and an integrated service menu that includes incorporation, Registered Agent representation, EIN application help, bank account assistance, and tax services. With more than 24 years of experience and over 15,000 companies formed, Prodezk streamlines the path from decision to operation for foreign owners. If you want transparent, personalized guidance and a single partner from formation through ongoing compliance, Prodezk is designed to simplify that journey.
Prodezk handles the administrative sequence—name reservation, state filings, registered agent setup, EIN support, and bank document packaging—so you can focus on growing the business instead of paperwork. By combining formation, registered agent, and tax services, we reduce hand-offs and provide one accountable partner for cross-border steps that often delay non-resident founders. Multilingual support in English, Spanish, and Portuguese reduces miscommunication for Latin American entrepreneurs and speeds onboarding. Examples include standardized document kits for banks and completing BOI reporting on clients’ behalf to ensure timely compliance.
These integrated processes lower administrative friction and create a more predictable timeline for launching a US LLC from abroad.
Beyond basic incorporation, Prodezk offers complementary services for post-formation needs: Registered Agent representation to meet state requirements, EIN application assistance for federal tax ID, bank account support for remote onboarding, and tax services covering income, sales tax, annual reports, and BOI reporting. This full-service compliance stack follows the LLC lifecycle from formation to operations and reporting, reducing the need to manage multiple vendors. Each service solves a specific pain point: Registered Agent for legal receipt, EIN support for tax ID challenges, bank assistance for remote accounts, and tax services for complex cross-border filings. For founders seeking coordinated support, these services are designed to work together and keep operations running smoothly.
If you need help with formation or ongoing compliance, consider booking a consultation with a provider that consolidates these capabilities to reduce administrative overhead and speed your go-to-market timeline.
This section answers common questions with short, practical responses focused on next steps and compliance priorities. The goal is clarity: concise answers that point you to the relevant parts of this guide for more detail. Topics include address requirements, expected costs, EIN needs, and remote banking feasibility—questions most non-resident founders ask early in the process. Each answer highlights the action you should take next.
Yes. An LLC must have a registered agent with a physical address in the state of formation, but owners do not need a personal US residential address. A registered agent provides the required local address for service of process and official communications. Many non-residents use virtual offices or commercial registered agents to meet state rules. Keep your registered agent contact details current and maintain internal ownership and management records for banks and tax filings. Using a professional agent also preserves privacy by avoiding listing your personal address on public records.
Costs depend on the state and the services you choose. Expect state filing fees, registered agent fees, and optional service costs for EIN assistance, Operating Agreement drafting, and bank introductions. Filing fees vary by state; registered agent and formation packages add predictable recurring costs. Other variables include expedited filings, notarization or apostilles for international documents, and ongoing accounting or tax support. For an accurate estimate, compare state fees and the bundled prices formation providers offer.
Yes—most LLCs need an EIN to hire employees, file tax returns, open bank accounts, and work with payment processors. Non-residents should obtain an EIN even without a US Social Security Number. Apply by completing Form SS-4 and submitting by mail, fax, or via an authorized third-party; some providers guide applicants when online issuance isn’t available. Getting the EIN early speeds banking and vendor setups and reduces later delays.
Yes, though success depends on the bank, the completeness of your documents, and the onboarding route. Options include fintech platforms with international onboarding, US banks that accept remote verification through introductions, and opening an account in person during a US trip. Banks usually require certified formation documents, an Operating Agreement, EIN, and IDs for beneficial owners; some ask for proof of business activity or notarized documents. To improve approval odds, prepare a complete document packet, work with providers who have bank relationships, and choose banks experienced with international clients. With preparation and the right partners, remote banking is achievable.
Foreign-owned LLCs must navigate federal and possible state tax rules. Key obligations include Form 5472 for reportable transactions with related foreign parties and filing Pro Forma Form 1120 when conditions require it. Beneficial Ownership Information (BOI) reporting to FinCEN is also essential. Understanding these requirements helps you avoid penalties and keep the LLC in good standing. Consider professional tax support to manage cross-border complexity.
Post-formation compliance means keeping accurate records, filing annual reports, and paying any state franchise taxes. Each state sets its own requirements and deadlines, so stay informed. A registered agent helps ensure you receive state notices on time. Maintain a compliance calendar and review corporate documents regularly to avoid administrative dissolution and to keep operations running smoothly with US partners.
Common challenges include strict documentation requirements and differing bank policies for international clients. Hurdles often involve proving business legitimacy, supplying certified formation documents, and obtaining an EIN. Some banks require in-person verification, which complicates remote onboarding. To mitigate issues, prepare a complete document packet and work with service providers that have established bank relationships for international customers.
A registered agent is the official point of contact for your LLC, receiving legal documents and state notices. Every LLC must have one with a physical address in the state of formation. For non-residents, a commercial registered agent protects privacy and ensures timely communication about filings and legal matters, making US operations smoother.
An LLC separates personal assets from business liabilities, so owners are generally shielded from claims against the company. To preserve that protection, follow good corporate practices: keep accurate financial records, meet compliance obligations, and avoid mixing personal and business funds. These steps help ensure the LLC remains a distinct legal entity.
An Operating Agreement lays out ownership, management roles, and profit distribution. Even when not legally required, it prevents disputes, clarifies internal processes, and helps demonstrate the LLC’s separate legal status—useful for banking and tax compliance. A clear, well-signed Operating Agreement is one of the simplest protections you can put in place.
Forming a US LLC as a non-resident delivers practical benefits: asset protection, operational flexibility, and stronger credibility with US partners. This guide covered the formation steps, compliance priorities, and strategic trade-offs tailored for international entrepreneurs. With the right preparation and support, you can navigate US formation and compliance confidently. Ready to move forward? Explore our services to simplify your LLC formation and stay compliant as you grow.
.svg){kind=icon}
.svg){kind=icon}
.webp)
