What a US LLC is and why founders abroad choose it
A limited liability company (LLC) is a US business entity formed under state law. It separates the business from its owners, called members, so business debts and lawsuits are generally the company's responsibility rather than yours personally. By default the IRS does not tax a single-member LLC as a separate entity, and a multi-member LLC is taxed as a partnership, although an LLC can elect corporate taxation instead.
You do not need to be a US citizen or resident, hold a visa, or have a Social Security Number to form one. Founders in India, Nigeria, the UAE, the UK and elsewhere use US LLCs to sign US clients, sell on US marketplaces, open US business accounts with fintech banks and accept payments through US gateways.
Who this is for
- Freelancers, agencies and consultants billing US or international clients.
- E-commerce and Amazon sellers who need a US entity for marketplaces and payment processors.
- SaaS and digital product founders who are not planning to raise venture capital yet.
- Anyone who wants a simple US company with light annual paperwork.
If you plan to raise money from US investors or issue stock options, a Delaware C-Corp is usually the better fit. See our C-Corp formation service and compare the two before you file.
Choosing a state
You can form an LLC in any state, and you do not need to live there. Non-US founders most often compare three. The figures below are state government fees from our state data; our own service fee is separate.
| State | State filing fee | Ongoing state cost | Owner names on public filing |
|---|---|---|---|
| Wyoming | Wyoming charges a $100 filing fee | Annual report license tax of $60 minimum | Not required in the articles |
| New Mexico | New Mexico charges a $50 filing fee | No annual report | Not required in the articles |
| Delaware | Delaware charges a $110 filing fee | Annual LLC tax of $400, due 1 June | Not required in the certificate |
If you will have employees, an office or significant operations in a particular state, you may have to register there as well, so the cheapest state is not always the cheapest overall. Compare all options on our state guides.
What BookMyLLC handles
- Name availability check in your chosen state.
- Preparation and filing of Articles of Organization, or a Certificate of Formation in Delaware.
- Registered agent service with a physical address in the state, which every state requires.
- An operating agreement for single-member or multi-member LLCs.
- EIN application with the IRS on Form SS-4, available in our packages or as a separate service.
- A digital document kit and dashboard access to your filings.
- Reminders for your annual report, state tax and federal filing dates.
What is included depends on the package you choose. See current pricing for the exact contents of each.
Step-by-step process
- Pick a state and a name. Your name must be distinguishable from existing entities and include "LLC" or an accepted variant.
- Share owner details. Names, addresses, ownership percentages and a passport copy for each member.
- State filing. We file your formation document with the Secretary of State.
- Approval. The state returns stamped articles or a certificate. Your LLC legally exists from the filing date.
- Operating agreement. You sign the agreement that sets ownership and management rules.
- EIN. Without an SSN or ITIN, the application goes to the IRS by fax or mail on Form SS-4, since the IRS online EIN tool requires one of those numbers.
- Bank and payments. With your articles, EIN letter and operating agreement you can apply for a US business account and payment gateways.
Documents and information you need
- A valid passport for each member.
- Your residential address abroad.
- Two or three name choices in case your first is taken.
- A short description of what the business will do.
- For multi-member LLCs: ownership split and who manages the company.
Timeline
State processing varies. Our state data puts standard processing at about 5 business days in Wyoming and about 7 in New Mexico and Delaware, and many states offer paid expedited filing. The EIN is a separate step: by fax, international applicants typically receive it within a few business days to a few weeks depending on IRS workload, and by mail the IRS asks you to allow 4 to 5 weeks.
What you file after formation
Forming the LLC is the start. A foreign-owned single-member LLC must file Form 5472 with a pro forma Form 1120 each year, and the IRS penalty for missing it is USD 25,000. Most states also require an annual report or tax. Beneficial ownership (BOI) reporting to FinCEN no longer applies to companies formed in the US: FinCEN's rules now limit reporting to companies formed under foreign law that register to do business in a US state. This is general information, not tax or legal advice, so confirm your filings with a CPA.
Common mistakes to avoid
- Choosing a state for a single fee. Look at the annual cost and where you actually operate.
- Using a residential address abroad on US forms that need a US address. Use your registered agent or a virtual office where appropriate.
- Skipping the operating agreement. Banks and payment platforms often ask for it.
- Forgetting Form 5472. It is due even in a year with no revenue if you funded the company.
Related services
Read our step-by-step guide to forming an LLC, and add an EIN registration if it is not in your package.
US LLC at a glance
Founders often ask for the short version before reading the detail. This table summarises how a US LLC works for an owner who lives outside the United States.
| Question | Short answer |
|---|---|
| Who can own it | Individuals or companies from any country; no US residency, visa or Social Security Number is needed. |
| Liability | Owners (members) are generally not personally liable for company debts, provided the company is run as a separate entity. |
| Default tax treatment | Single-member LLC: not taxed as a separate entity by default. Multi-member LLC: taxed as a partnership. Either can elect corporate tax treatment. |
| Public record | Depends on the state; some states do not require member names in the formation filing. |
| Ongoing upkeep | State annual report or tax where the state requires it, a registered agent, and IRS filings such as Form 5472 for a foreign-owned single-member LLC. |
| Best suited to | Freelancers, agencies, e-commerce and SaaS founders who do not plan to issue shares to venture investors yet. |
LLC or C-Corp: which fits your plan?
Both are US entities and both can be owned from abroad. They differ in how they are taxed and how easily they take on investors.
| LLC | C-Corp | |
|---|---|---|
| Ownership | Membership interests, flexible split | Shares of stock, suited to option pools and investors |
| Federal tax | Pass-through by default | Corporate tax paid by the company; dividends to owners are taxed separately, with withholding rules for foreign shareholders that a tax treaty may reduce |
| Paperwork | Light: operating agreement, annual report where required | Heavier: bylaws, board and stockholder records, stock ledger |
| Typical founder | Service business or small online business | Startup planning to raise venture funding |
If you are unsure, our free business consultation walks through your plan before you file.
What an LLC costs to run
The price of formation is only the first line. Plan for the recurring items below so there are no surprises in year two.
| Cost | When it applies | Who sets it |
|---|---|---|
| State filing fee | Once, when the LLC is formed | The state government |
| Registered agent | Every year, for as long as the LLC exists | The agent you choose |
| State annual report or tax | Yearly or every two years, depending on the state | The state government |
| Federal filings | Yearly; foreign-owned single-member LLCs file Form 5472 with a pro-forma Form 1120 even with no income | The IRS |
| Bank or payment account fees | Monthly or per transaction | The provider |
Missing a recurring item is where most problems start: an unpaid annual report can lead a state to mark the LLC delinquent, and a missed Form 5472 carries a penalty. Our annual report and IRS filing services keep both on a calendar.
Why founders outside the US choose an LLC
A US LLC gives a business outside the United States a recognised footing with American customers. A US client can pay a US company by ACH or card without the friction of an international wire, a marketplace can verify a US entity, and a payment processor can onboard it under familiar rules. For a freelancer in India or an e-commerce seller in the UAE, those practical gains are often the whole reason to form one.
The structure is also simple to run. There are no required annual meetings or minute books in most states, the paperwork is mostly the operating agreement and the annual report, and the owner can be paid through distributions. Simple does not mean unregulated, though: the IRS expects Form 5472 from foreign-owned single-member LLCs, and your home country may tax the income you receive from it. Speak to a tax adviser in your own country before you rely on any tax outcome.
A realistic first-month checklist
- Week one: choose the state and company name, and sign the operating agreement.
- Week two: state filing is processed; confirm the registered agent is in place.
- Weeks two to four: apply for the EIN, then open a US bank or payment account.
- After that: set your calendar for the annual report and the IRS filing so neither is a surprise.
If any step stalls, tell us early. Most delays come from a name that is already taken, a mismatch between documents, or an IRS form returned for a missing detail, and all three are quicker to fix when caught in the first week.
