Deborah Sweeney, for Business 2 Community writes: It’s a question that’s much more commonly asked than you think – are
there any benefits to non-U.S. residents filing corporations or LLCs in
the United States or is the process so complicated that it’s best to
avoid doing it? The answer is the procedure is fairly similar to what
residents of the United States experience filing and that yes, there are
a series of great benefits that come in doing so.
1. Limited Liability Companies
(“LLCs”) are popular business structures for partnerships and
individuals, due to the attractive tax and legal benefits, and personal
liability protection that they afford. As a non-U.S. citizen,
incorporating a business in the United States is generally similar to
the procedure required for a U.S. resident. Because U.S. citizenship and
residency are not necessary, non-U.S. citizens are welcome to start or
expand on American soil without jumping through any more hoops than a
U.S.-born business owner.
2) Company incorporation in the United
States is administered at the state level —not the federal level — for
both foreign nationals and U.S. citizens. The process will differ from
state to state but is generally comprised of two steps: 1.) applying to
register in that specific state and 2.) establishing a registered agent
with a valid, physical address in the selected state.
3) For
foreign businesses, an Individual Taxpayer Identification Number (ITIN)
will satisfy the requirement that each business must have a taxpayer
number. The Internal Revenue Service (IRS) issues these tax processing
numbers to individuals who have to pay U.S. taxes but are not eligible
for a Social Security number. Residents and non-resident aliens as well
as foreign nationals fall into this category.
4) To receive
pass-through profit distributions, a foreign citizen may form a limited
liability company. In contrast, all profit distributions (called
dividends) made by a C corporation are subject to double taxation.
(Under US tax law, a nonresident alien may own shares in a C
corporation, but may not own any shares in an S corporation.) For this
reason, many foreign citizens form a limited liability company (LLC)
instead of a C corporation.
5) A foreign citizen may be a
corporate officer and/or director, but may not work in the United States
or receive a salary or compensation for services provided in the United
States unless the foreign citizen has a work permit (either a green
card or a special visa) issued by the United States.
6) If you
intend to open a bank account in your home country or if a local company
or government office will require proof of the formation of your U.S.
Corporation or LLC, you may need to have the company formation documents
certified with an “Apostille” or “Certificate of Authentication”. An
Apostille, which is an agreement between countries to accept each
other’s documents) is only available if your country is a member of the
Hague Convention.
Sunday, March 31, 2013
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