How to Set Up a LLC in USA for Non-Residents + US Bank Account (all sources shared)

[indianmojojojo]

LLC
Limited Liability Company

it comes under corporation?

If your LLC has Reportable Transactions with more than one Related Party, you must file a Form 5472 for each Related Party. For example, if your LLC has Reportable Transactions with yourself and another Related Party, you need to file two Forms 5472.

So did you get any notice from the IRS to pay taxes now? I believe there is no sales tax for digital services

 

[shiv durga]

If your LLC has Reportable Transactions with more than one Related Party, you must file a Form 5472 for each Related Party. For example, if your LLC has Reportable Transactions with yourself and another Related Party, you need to file two Forms 5472.

So did you get any notice from the IRS to pay taxes now? I believe there is no sales tax for digital services

can you please define Reportable Transactions?

no notice from IRS.
I am just concern that if I have to pay taxes then I should be prepared and do business accordingly.
or I will find out later that i have to pay tax more than my earning.

 

[TiagoS]

I also have a Wyoming LLC, But can someone show some light on taxes?
Actually I was thinking Wyoming do not have income tax and only 4% sales tax which applied if we sell something within wyoming.
so only fill the report at the end of the year and thats it.

but now what is form 5472????
after doing business for 1 year in the end I come to know that I have to pay taxes more than my earnings
I am scared now
please can someone explain form 5472 and all the taxes I will be responsible to pay at the end of the year?

No STATE tax, but you still have to pay Federal tax. And yes, you gotta fill shit tons of forms. I pay an accountant to fill everything for me , it’s usually around $700 a year, and I give them the profit / loss report from an accountant software, Quickbooks. Very concerning that you have no idea about your taxes, you are asking for trouble. I suggest you hiring an accountant, especially if you didn’t fill last year taxes.

 

[indianmojojojo]

can you please define Reportable Transactions?

no notice from IRS.
I am just concern that if I have to pay taxes then I should be prepared and do business accordingly.
or I will find out later that i have to pay tax more than my earning.

https://www.llcuniversity.com/irs/form-5472-foreign-owned-llc/
Please check here, even am figuring out, I believe form 5472 is required for aliens and i think its only a form to be filed. This will ensure there is no tax evasion. There is a 25K penalty

 

[indianmojojojo]

No STATE tax, but you still have to pay Federal tax. And yes, you gotta fill shit tons of forms. I pay an accountant to fill everything for me , it’s usually around $700 a year, and I give them the profit / loss report from an accountant software, Quickbooks. Very concerning that you have no idea about your taxes, you are asking for trouble. I suggest you hiring an accountant, especially if you didn’t fill last year taxes.

What platform do you use to hire accountants?

 

[shiv durga]

No STATE tax, but you still have to pay Federal tax. And yes, you gotta fill shit tons of forms. I pay an accountant to fill everything for me , it’s usually around $700 a year, and I give them the profit / loss report from an accountant software, Quickbooks. Very concerning that you have no idea about your taxes, you are asking for trouble. I suggest you hiring an accountant, especially if you didn’t fill last year taxes.

I formed LLC in january so not yet faces tax issued.
but what tax rate I need to pay taxes?

 

[shiv durga]

How much is Federal Tax?

 

[TiagoS]

I formed LLC in january so not yet faces tax issued.
but what tax rate I need to pay taxes?

Depends on your profit, the tax bracket is dynamic. Also depends on your company structure, Im considering it’s a single owner LLC. But really, pay an accountant and ask all the questions.

 

[Setox]

I pay an accountant to fill everything for me , it’s usually around $700 a year

What company you've used to form your LLC ?

 

[shiv durga]

Depends on your profit, the tax bracket is dynamic. Also depends on your company structure, I believe it’s a single owner LLC?

yes single owner
but as far as I know if I get ITIN issued then only I need to pay taxes in USA
and if I own assets in wyoming more than $250k then I need to pay taxes in wyoming.
right?

 

[indianmojojojo]

https://prnt.sc/5pQaOInaE4Fj
https://www.quora.com/Single-member...-taxes-in-the-US-What-forms-do-I-need-to-fill

 

[shiv durga]

no taxes mate...

 

[shiv durga]

View attachment 216069
no taxes mate...

federal tax is only for the residents.
and I use Binance to receive crypto payments which is not a US paymemt gateway.
So I am free.

 

[Huncho]

Hey mate, nice post. Could you please tell me how long you wait for EIN?

Does it required to open Mercury?
Can I Transfer money from mercury to Payoneer personal account and cash up from ATM?

 

[gioprise]

federal tax is only for the residents.
and I use Binance to receive crypto payments which is not a US paymemt gateway.
So I am free.

When you formed your business and the IRS opened your EIN, no matter if you are a non resident or not your company is a USA company with a USA EIN and thus subject to federal taxes. The only thing that differs is how those taxes need to be filed with the IRS and state if you are operating in a state that has state taxes or gross receipts taxes. With the reporting threshold dropping to $600 for marketplaces, platforms and processors in 2022 1099-K`s will be submitted to the IRS after the user/merchant surpasses $600 in sales. If you are receving payments on any platform or service using your EIN as your tax ID, those earnings will be reported to the IRS no matter if you are a foreign/non resident founder or director or a resident founder/director. The second you incorporated in the USA your company became a resident company. Visa, citizenship, residency status of the directors doesn`t change the residency status of the company and neither does management location. The federal tax rate is a flat 21% of net revenue.

If you are any of the following, you must file a return:

1. A nonresident alien individual engaged or considered to be engaged in a trade or business in the United States during the year.
2. A nonresident alien individual who is not engaged in a trade or business in the United States and has U.S. income on which the tax liability was not satisfied by the withholding of tax at the source.

If you are taking payments through Binance using a Binance Business account then that means you had to enter, confirm and verify your EIN which means any payments received through Binance are technically taxable by the IRS. USA resident companies are taxed on worldwide income. I run a PRO service so can give you the basics but you`ll have to talk to a full fledged accountant to get a bigger picture as there are other variable (withholding percentages, etc) that could play a role based on your entity structure.

Incorporating in Wyoming saves you the hassle of having to deal with corporate and personal income taxes but you formation status there along with your non resident status doesn`t exempt your resident USA company from federal taxes.

Also to expand on some other issues I`ve seen in this post. Mercury. Good service but its limited and very risk adverse. If you are attempting to open an account to attach to Ebay or other marketplaces its not the best solution, especially if you are trying to open and receive payments for multiple accounts. You`d be better off with Relay or Revolut USA Business who`s accounts are provided through Metropolitan Commercial Bank as opposed to Evolve Bank and Trust.

Also $200 is still far too high a price for formation services if all they are offering is state articles, EIN, and a year of registered agent service. They should be providing full legally prepared documentation as certian banks and processors are going to ask for resolutions and bylaws or organizational charts along with your EIN, articles, proof of address and identity documents. You should only be paying between a $49 - $70 service fee for service that only includes articles, EIN and registered agent service. So for a Wyoming company that would come too: $151 - $172 with state fees included.

 

[TiagoS]

When you formed your business and the IRS opened your EIN, no matter if you are a non resident or not your company is a USA company with a USA EIN and thus subject to federal taxes. The only thing that differs is how those taxes need to be filed with the IRS and state if you are operating in a state that has state taxes or gross receipts taxes. With the reporting threshold dropping to $600 for marketplaces, platforms and processors in 2022 1099-K`s will be submitted to the IRS after the user/merchant surpasses $600 in sales. If you are receving payments on any platform or service using your EIN as your tax ID, those earnings will be reported to the IRS no matter if you are a foreign/non resident founder or director or a resident founder/director. The second you incorporated in the USA your company became a resident company. Visa, citizenship, residency status of the directors doesn`t change the residency status of the company and neither does management location. The federal tax rate is a flat 21% of net revenue.

If you are any of the following, you must file a return:

1. A nonresident alien individual engaged or considered to be engaged in a trade or business in the United States during the year.
2. A nonresident alien individual who is not engaged in a trade or business in the United States and has U.S. income on which the tax liability was not satisfied by the withholding of tax at the source.

If you are taking payments through Binance using a Binance Business account then that means you had to enter, confirm and verify your EIN which means any payments received through Binance are technically taxable by the IRS. USA resident companies are taxed on worldwide income. I run a PRO service so can give you the basics but you`ll have to talk to a full fledged accountant to get a bigger picture as there are other variable (withholding percentages, etc) that could play a role based on your entity structure.

Incorporating in Wyoming saves you the hassle of having to deal with corporate and personal income taxes but you formation status there along with your non resident status doesn`t exempt your resident USA company from federal taxes.

Correct. I’m non us resident, with a company In Wyoming and I do pay federal tax. Except that I pay it together with personal income tax, due to the fact that it’s a single member LLC, “pass through” / disregarded entity. so the tax bracket is dynamic, because I’m taxed as individual. I told him already before, he must hire an certified accountant and explain his situation. He will have to tell the accountant the business structure, the country he’s from and the accountant will tell him all his obligations.

 

[gioprise]

Correct. I’m non us resident, with a company In Wyoming and I do pay federal tax. Except that I pay it together with personal income tax, due to the fact that it’s a single member LLC, “pass through” / disregarded entity. so the tax bracket is dynamic, because I’m taxed as individual. I told him already before, he must hire an certified accountant and explain his situation. He will have to tell the accountant the business structure, the country he’s from and the accountant will tell him all his obligations.

Exactly. The only thing that changes is the mode of reporting. C-corp, S-corp/LLC and withholding, especially with an C-corp or S-corp in which certain profits will be paid as dividends to shareholders as opposed to profits to members of an LLC. I try to explain this to people in terms of having a child. When you have a baby in the hospital, they give your baby a birth certificate and a social security number. When that baby grows up and gets a job, they will have to pay income taxes no matter the status of their parents at that time. When someone incorporates a company in the USA the state articles are the birth certificate and the IRS EIN is equal to an SSN. If your company starts making money it will have to pay taxes regardless of the residency status of its directors... Also I don`t think they understand, besides the potential IRS issues, not having tax returns to verify revenue and organized books is going to come back to bite them in the a** in terms of expanding or being approved for services when/if they out grow payment facilitators, FinTech`s, marketplaces, etc. At some point they are going to need verifiable revenue information and/or accurate Duns profile to expand their businesses.

 

[chagernish]

How much time its taken on everything, Company Formation To Bank Account?

 

[whywork]

Awesome share, this is perfect for me.

Has anyone already tried this method besides the OP?

 

[shiv durga]

The federal tax rate is a flat 21% of net revenue.

Is this correct?
revenue or Income?