From Incorporation To Operation: A Non-US Resident’s Guide To Setting Up LLC
The United States of America (USA) represents a land of opportunities for people all over the world. Whether you are a student looking to study abroad, or a businessman planning to expand your business abroad, the USA provides numerous opportunities.
For a Non-US citizen or resident, setting up a business in the US, nowadays is less complicated than before. However, some limitations and additional regulations exist for non-residents to operate businesses in the US.
From selecting the type of business to obtaining the necessary licenses and permits to understanding the US tax system, all are crucial factors in determining the success or failure of setting up your operations in the “land of opportunities”.
Below, we guide you on setting up a limited liability company (LLC) in the US, a form of business a non-resident can set up.
(Please also note that you do not require citizenship to operate a business in the US. Just make sure the business forms either an LLC or a Corporation).
A Limited Liability Company (LLC) is a form of business that requires filing paperwork with the state. An LLC may consist of one owner or multiple owners (known as “members”).
When operating an LLC business, your assets will not be affected because of business debts. Also, you will not be held liable if a co-owner neglects his duty in business matters.
LLCs are run by a set of rules, signatures on agreements. However, the regulations and terms are more flexible and business-specific in contrast to the terms of corporation business.
For non-residents, filing for LLCs are similar to those of US citizens, with few exceptions. We lay down the steps to LLC registration as non-US residents to operate a business as follows:
Make yourself aware of the tax regulations of the US states. Some states do not have income tax rules, so you only will have to bear the federal taxes. As of December 2022, 09 states do not charge income tax to their residents.
As a potential business owner in the US, though, you are required to file a taxpayer identification number (TIN), with the IRS (Form W-7) and be taxed as per state and federal laws. This process may take many weeks to be finalized, even though it is relatively simple.
Make sure you have a unique business name registered in the US state of your business (primary place of your business), and that it complies with the local laws. Also, get an online website address according to the name you want so people can associate with your business.
Hire a registered service or agent residing at your primary place of business. Let them carry out some of the business formalities and assist with filing for Articles of Organization, also known as Certificate of Formation.
Your registered agent or service should also be able to represent you in business disputes that require settlement in the US.
Obtaining an Employer Identification Number (EIN) for your US company can be done quickly and easily online, as long as you have a valid Taxpayer Identification Number (such as a Social Security Number or Individual Taxpayer Identification Number).
If you do not have one of these numbers, there is still a way for you to obtain an EIN by submitting an application through mail or fax.
The process may take longer but it is still possible for international founders to obtain an EIN for their US company.
Your limited liability company should have its bank account(s) because it must be separate from your bank account.
As mentioned earlier, you must register for a physical address for your business in the US. This will also be needed to open your business account as a non-US citizen. Plus, you need supporting documents that prove your address to open the bank account (s).
Opening business bank accounts is the most challenging step in the process. Firms like Business Globalizer can help you with opening bank accounts in the US if you find the process difficult. Remember, one mistake in this process can end all your chances of opening a business in the US.
As an LLC owner, you need documentation and documents of standard operations to run it. You need to create an operating agreement, depicting management roles, daily processes, profit sharing, ownership rights, and all business-related processes to operate your US business.
Like tax regulations, this agreement’s legal requirement varies, so check with your legal consultant and state laws.
Finally, make sure you have collected all the legal business licenses and work permits to run a business in the US.
The requirements will vary to some extent depending on state regulations, so check with your legal advisors or relevant business consultants.
Also, once you open your business, you may have to submit annual reports to the state or local authority, depending on state regulations.
Thus, you should file for a U.S. Non-resident Alien Income Tax Return form (Form 1040-NR) and a U.S. Return of Partnership Income form (Form 1065), after consulting your tax advisor or accountant.
Setting up a business in the US may look highly profitable and lucrative but it is not a “piece of cake”. As non-US residents, you will face some complexities along the way.
Firms like Business Globalizer facilitate your business initiative(s) in the US by reducing the complexities. Business Globalizer helps you through:
- consulting in the process,
- bank account opening in the US,
- tax management in the US,
- payment method setting,
- legal consulting,
- and all that you need to sit at home in Bangladesh and set up an effective business in the US.
Their team of experts helps you go global and run an authentic, money-making business in the US.
Firms like Business Globalizer help you to run a business in the USA from your home country. You only need an authentic visa and relevant permits or licenses to set up your “American LLC”, from your other country. But make sure you adhere to the state tax laws and relevant business laws. Then, you are good to go!
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