How Non US-residents Can Form An LLC

LLC, which stands for Limited Liability Company, is a legal type of business entity which offers limited liability to the owners as per United States law. Formation of an LLC in the USA is a common process as it can offer a lot of benefits. Whether you are a US resident or a non-US resident, you can easily form an LLC in the United States.

Nowadays there are many LLCs in the US, some of which have been incorporated by US non-residents. Some of the owners of the LLC operate from within the country and some operate completely from outside the US. Note that as a non-US resident, you have to register the LLC in one of the states in particular and not in the country as a whole.

Generally, citizenship or residency requirements are not required for forming an LLC in the USA. However, various factors are to be considered. Most states do not demand the disclosure of director information during formation of the LLC, but when you file next year's annual report it will become a mandatory entity.

Many people feel that their entity must be a non-tax-paying entity, i.e. pass through taxation. As a non-US resident, you will not get this in an S Corporation as it requires all shareholders to be US residents. However, by forming an LLC it is definitely possible for you to achieve this target.

A limited liability company can elect to be taxed as either a corporation or a partnership. This is done along with the filing of the LLC's application for a tax ID or employer identification number. Given certain restrains, this selection may be changed in consequent years.

For every corporation incorporated in the US, it is mandatory to file a US tax return irrespective of whether there is any US income or not. But in case of a limited liability company, it is taxed as a partnership. Hence, the partners file and pay individual US taxes, if they operate a business in US or if they possess US-sourced income. In the event of mixed US and non-US income, forming an LLC in the USA can be advantageous.

You can create a limited liability company in any US state as it is a cost-effective option to have an office in that state of the US where you wish to establish the LLC. It is reported that a large number of non-US residents opt for Delaware or Nevada. This is particularly because of the simple compliance requirements and business-friendly environment.

If you reside outside the US, then you can use the services of different companies that offer services for forming a USA LLC. Such companies can be easily searched online. With the advantages it offers and the ease in its creation, a USA LLC can be a useful way to establish a business.