How to Open an LLC in the USA?

Registering an LLC (limited liability company) is the best way for a non-U.S. citizen to start a business in the United States.

Anyone can register an LLC in the U.S.; you do not need to be a U.S. citizen or own an American company.

Registering an LLC in the USA

The most important factor to consider when forming your LLC in the U.S. is compliance. You must ensure that all state and federal requirements are met so that you can legally start and operate your business.

The key steps include choosing the state for your LLC, registering the LLC, obtaining an Employer Identification Number (EIN), and having a physical address in the U.S.

We'll guide you through these tasks in the steps below.

Note: Forming an LLC in the U.S. does not grant you any visa to work in the country.

Steps to Register an LLC in the USA?

Any person or foreign business can form an LLC in the U.S. You can complete these steps on your own using our guides or hire an international business service that handles everything, including opening a U.S. bank account, maintaining a U.S. address, LLC formation, registered agent services, and U.S. tax support.

Here are the steps to forming a foreign-owned LLC:

1. SSelect a State
2. Name Your LLC
3. Hire a Registered Agent Service
4. File Your LLC with the State
5. Create an LLC Operating Agreement
6. Obtain an EIN
7. Get a Physical Mailing Address in the U.S.
8. Open a U.S. Bank Account
9. Prepare for U.S. Tax Filing

1. Select an State

It is generally advisable to form an LLC in a state without state taxes so that you only need to deal with U.S. federal taxes.

However, if your business requires a physical presence, such as an office or employees in a specific state, you should form your LLC in that state.

Choosing the right state depends on whether you need a physical presence. If not, forming your LLC in a tax-free state can reduce compliance costs.

2. Name Your LLC

Each state has its own rules on acceptable LLC names. In general, you must follow these guidelines:

• Your name must include "limited liability company" or an abbreviation (LLC or L.L.C.).
• Your name cannot include words that could confuse your LLC with a government agency (e.g., FBI, Treasury, State Department).
• Restricted words (e.g., bank, attorney, university) may require additional paperwork and a licensed individual (such as a lawyer or doctor) as part of your LLC.
• Check domain availability: Even if you don't plan on launching a website immediately, securing a matching domain name is recommended.

3. Hire a Registered Agent

A registered agent is a person or company that receives legal documents on your behalf.

Most states require LLCs to appoint a registered agent, who must reside in the state where your business is registered or be a corporation authorized to operate in that state.

For foreign-owned LLCs, hiring a professional registered agent service is often the best option, ensuring compliance and availability during business hours.

4. File your LLC with the State

To officially form an LLC, you must file the required documents with the state. The most common document name is "Articles of Organization," but it may also be called a "Certificate of Formation" or "Certificate of Organization."

This document outlines your LLC's organizational structure and specifies whether your company is member-managed or manager-managed.

5. Create an LLC Operating Agreement

Although not required in most states, having an operating agreement is a good practice.

An LLC operating agreement is a legal document that defines ownership and operational procedures.

Why is it important?

• Ensures all business owners are on the same page.
• Helps prevent future disputes.

6. Obtain an EIN

An Employer Identification Number (EIN) serves as your LLC's tax ID.

You do not need a U.S. Social Security Number (SSN) or an Individual Taxpayer Identification Number (ITIN) to obtain an EIN.

Non-residents can apply via fax or mail to the IRS if they cannot apply online.

7. Get a Physical Mailing Address in the U.S

A U.S. mailing address is required to form an LLC and open a bank account.

You can:

• Establish an office in the state where your LLC is formed.
• Use a virtual mailbox service (e.g., Earth Class Mail) to receive and forward your business mail online.

8. Open a USA Bank Account

After successfully forming your LLC, opening a U.S. bank account is essential.

Benefits include:

• Conducting transactions in U.S. dollars.
• Improved credibility.
• Easier access to business loans.
• Stronger business credit.

A separate business account also helps maintain the corporate veil, protecting your personal assets from business liabilities.

Tax Implications: Your LLC will be taxed in the U.S. on income derived from business activities in the country.

You will be considered "engaged in U.S. trade or business" if:

• You have an employee working exclusively for your LLC in the U.S.
• That employee plays a key role in your business activities in the U.S.
• Your LLC engages in substantial, continuous, and regular business within the U.S.

Tax filing requirements depend on your LLC's structure:

• Single-Member Foreign-Owned LLCs: Must file Form 5472 and Form 1120 annually.
• Multi-Member Foreign-Owned LLCs: Must file Form 1065, along with Schedule K-1, and may need to file Forms 8804 and 8805 if the business generates U.S. income.
• Note: Failure to file Form 5472 results in a $25,000 penalty, with additional monthly penalties.

9. Prepare for U.S. Tax Filing

The Internal Revenue Service (IRS) oversees tax regulations for LLCs.

Single-Member LLCs: File Forms 1040-NR, 5472, and 1120.

Multi-Member LLCs: File Forms 1040-NR, 5472, and 1065.

Reminder: Filing Form 5472 late results in a $25,000 fine, with additional monthly penalties.

Conclusion

The most important factor when forming an LLC in the U.S. is ensuring compliance with all state and federal regulations. This allows you to legally operate your business from abroad while maximizing your benefits and minimizing risks.