Because LLC ownership structures are determined by the state, and not federal laws, it can prove difficult for non-residents. This means that if you operate an LLC in the U.S., there are different rules for your responsibilities depending on which state you’re in. And because laws vary so much from state to state, it isn’t easy to generalize.
But it’s also important to know that the state-by-state laws are significant because they will determine your specific tax liabilities. Remember, all LLCs are required to pay taxes, but it’s the type of taxes and due dates that vary depending on your state and how you use your US LLC for non-us residents.
An LLC can a foreigner own?
Short answer is yes. A non-resident can form an LLC in the United States if they meet the conditions of having a physical address in the state in which they intend to operate their business.
The first thing you should do is find an expert in business formation who will be able to clarify your state’s requirements.
What if I have an LLC for my business?
No, you can’t. It’s important to understand that you cannot get sued personally just because your LLC is sued. The only way you can get sued for your LLC’s debt is if your LLC’s debt comes from a personal guarantee. Personal guarantees that you make a loan to your LLC can put your assets at risk.
The law regards you, as an LLC owner and separate entity from your business. Your company could be sued for not paying its employees or vendors, although this does not place you at risk.
To do business in America, should I create an LLC?
Generally, yes. It is one of the best ways to conduct business in the U.S. However, it’s important to note that you can’t just open an account in your LLC’s name, place it in the mail, and call it a day. In order to allow an LLC to do business in the U.S. you must first register the LLC by properly filing all necessary documents.
How can I create an LLC?
This depends on the state in which you operate. Your state may require registration of your US company formation. The federal government will not. Therefore, it’s essential to check with your state’s business licensing bureau before establishing an LLC.
What is the cost of a LLC vs. a corporate entity?
Usually, yes. Forming an LLC can sometimes be more expensive than incorporating, but it’s generally cheaper than creating a corporation.
Do I have to incorporate my LLC into my name?
Yes. Yes. This is because it’s easier to operate the company under your personal name than set up an LLC in your company’s name. This makes it easy for the public and the media to see that an individual is the owner of the company.
Conclusion
The LLC is a fantastic way to set up and manage a business in America. Many non-residents who use their LLC for business purposes prefer them to corporations, and the reason is simple: they don’t have shareholders to please. With an LLC you can do nearly everything a company can with it. Most states permit you to choose either an S-Corporation or an LLC.
But it’s important to know that LLCs can only be operated under state law. And that is why it’s necessary to clarify the LLC laws in your state before you start operating your LLC, especially if you are a non-resident.
The Truth About Owning an LLC In the US For Non-Residents originally appeared on Enterprise Podcast Network (EPN).
