Can a Foreign Owner of a US LLC pay ZERO US Tax?
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- čas přidán 31. 01. 2021
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What Are The Taxes For A Non-Resident Owner Of A US LLC? If a Foreigner owns an American Company do they need to Pay ANY Taxes in the US?
These are actually very common questions I get asked a lot. Even lawyers and accountants ask me whether Non-Americans need to pay US taxes when they open an American company. Is this something you should be worried about? How complicated this topic is? Today I'm going to answer all the possible questions you can have regarding this matter. Also, I'm going to point out some principles that can be used in other structures as well, so even if you're an American you could benefit from them.
If you want to save on TAXES you're in the right place!
In the US there is a variety of different companies, the most important two are the US LLC & C Corp
C Corp will always be taxable in the US, so if you're a foreigner you're better off forming an LLC company. If you own a single-member LLC in the US it is considered a disregarded entity, meaning that it doesn't exist for tax purposes. This is similar to being a sole trader or a sole proprietor.
Let's give an example. Let's say that I'm a dropshipper who is selling products all over the world. I'm based in Cyprus, and business is done completely online. If I set up a C Corp in the US it is very clear that the company will be taxable. But what if I have a US LLC? Will that company be taxable in my case? In order to be taxed in this case, I'd need to have a permanent establishment in the US. MY US LLC wouldn't be considered a permanent establishment. In my case, there is also a tax treaty between US and Cyprus. All this means that I am not liable to US taxes for my LLC.
But what if there's no tax treaty between the US and your country of residence? Are you liable to pay taxes in the US? Short answer - you don't have to be!
We'll need to dive into some definitions here, what we call ''effectively connected income'' and ''US trade or business''.
If you don't have people in the US - employees or full-time contractors, sometimes referred to as a dependent agent, you SHOULD NOT be taxable in the US.
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Your channel has much better info than others who are very vague! I was wondering about US LLC and UAE. The transparency is appreciated and I will definitely come to you in future if i need further professional advice.
Thanks! Look forward to hearing from you
The most helpful video I have seen on taxes online. Too many people nowadays who knows nothing trying to give you advice but first asking you to book a coaching call! THANK YOU!
Glad it was helpful!
wow! no pish posh, straight to the point and actually valuable information. You just gain a new subscriber sir!
Thanks very much, Michael. You are explaining things which others are not.
Our pleasure!
Anything you'd like to see next?
You explained it very well, thanks.
Do you have single member LLC or multi member LLC?
You make great content that actually delivers value. Certain other... offshore nomads... while entertaining do not provide the same actionable info that you do. Keep it up!
Thanks! Any specific content you'd like to see?
What if I store money in US bank that I earned doing business in US (yes I am non US resident and own LLC) , am I still taxable?
@@extendo7137 Very goo question. Is he going to answer it?
@@extendo7137 money earned in US is taxable , where ever u keep it .
Hi! Which is the American ssn equivalent in Portugal?
Cheers
Great video Michael!!
Let’s say for a company that sells services instead of goods but gets its clients from abroad. How are the taxes different in the case of this company being owned by a US citizen vs a non-resident is the money made comes from clients in other countries in the European Union for example.
Great break down man... 👍🏾
This is a sweet channel. Easy to listen too
Thank you, Joe! Appreciate the support.
Anything you'd like to see?
Hey man.. great content and what luck.. i am in the process of thinking of opening a US LLC n was worried about the US tax on non-US citizen LLC. keep it up man
Always happy to be of service!
Anything you'd like to see next?
This is freaking amazing. Thanks
Always our pleasure 😄
Anything you'd like to see next?
@@OffshoreCitizen What if I store money in US bank that I earned doing business in US (yes I am non US resident and own LLC) , am I still taxable?
@@extendo7137 depends on the substance behind it and rules in your home country. If you want to go through the details the best option is to book a call as specifics really matter here
Great information here..
Glad you liked it
Anything else you'd like to see on our channel?
Great work
Keep rocking bro
💪
Anything you'd like to see next?
Hello, I have a specific question, hopefully you could help me. Most people recommend LLCs to operate a business in US as a non resident, however, I am a Canadian resident would that be the same case or would I be better off with a Corporation, tax wise. Appreciate the help
The territorial taxing system in Costa Rica is pretty strange because it's true what you said, but also what every accountant tells us is that since there's no customer to register for the invoice, that income is not taxable. Even, there's an income tax exemption given to costarricans that work for a local company that only exports software services to companies outside of our land. I know because Ministerio de Hacienda gave my last company that tax exemption for us, so we still needed to report out income in a monthly basis but it wasn't taxable so we payed zero at the end of year (for that income specifically)
really good stuff
Thanks! Always happy to be of service😄
Anything you'd like to see next?
Terrific content as expected, great job. Would you kindly consider the topic of the infinite banking concept or be your own banker using a trust and whole life insurance, and using a holding company to oversee LLCs for various investment and business operations in addition to accessing business lines of credit. This would be a terrific topic that i know many are keen to use your services to implement.. 😊
Hey did you get an answer I just read Nelson Nash book
@skoutman8507 No, not yet.
@@jonathanbartsch2938 are you a practitioner of the IBC
Thank you!
You're welcome, Ross!
Do you already own an LLC or looking to open one?
Great video! Does residency in Panama get treated different than other countries for this, or are they treated same as another no tax treaty country like UAE? I ask because I heard something about Panama companies being treated as US for tax purposes, not sure details, maybe you could do video on that.
A Panama company won't be treated as a US company for tax purposes but this doesn't mean it won't be taxable. There are multiple ways by which a company could be taxable in the US so you need to ensure you avoid all the pitfalls.
Well, even though English is not my first language, but your explanation is perfect. Thumbs up.
Thank you, Abdel!
Anything you'd like to see next?
@@OffshoreCitizen actually if you can clarify this statement : LLC Owned by an alien- non resident is taxable when Selling physical products if the shipping point is from the US.
Hello Michale, could you make a new video on the new law in UAE in which they are granting citizenship to investors and scientists.
Definitely will do in the next couple days.
@@MichaelRosmer do you know anything about the Al Hamra (RAK/UAE) offer of 12 years of free resident visa and business license for buyers of property in their project? Prices start from $80k and 20%×5 years payment plan is available btw.
@@pak74x yes, what about it? There are a few offers for years of free visas being included but note this is just the visa renewal costs, which aren't very substantial and you still need to renew they just don't charge you that portion of the fee when you do.
Your videos are gold! Congratulations!
Btw, what about Georgia ? They have territorial tax, but is it on operations?
In other words, being a resident in Georgia and having an LLC in USA without any operations or employees in USA, I think there would not be any taxes not in USA and neither in Georgia right?
Thanks!
Thanks! It really depends on the nature of the operations and business. But potentially you could be able to avoid tax that way.
With Panama, Costa Rica and Paraguay this would work. In Georgia things are a bit more complicated, there are several exemptions from the territorial tax regime.
Thank you for your interesting video and information Michael. If a person open an LLC as SMLLC-NRA(foreigner from Mexico),the resultant profit of the LLC(revenue from abroad less expenses and costs from abroad) can be transfered from the US BAnk of the LLC to the Mexico Bank of the individual owner?. 2nd q-If the LLC pays virtual office rent in NY that makes the LLC taxable in US?. 3rd one-the LLC can open a bank account and hire merchant services easily?(stripe, fiserv....). Last one-The Membership services and online training services would be classified as royalties? in such a case the LLC will be taxable or the NRA?. Thank´s in advance....
Great information! Thank you very much. I will be in touch and will contact you through the site.
Thank you, Mark.
Looking forward to connecting with you!
This helped A LOT! Thanks!!!
Happy to hear that. You're welcome! Always happy to be of service ☺
Anything you'd like to see next?
@@OffshoreCitizen How can I buy a UK plot of land anonymously to the UK government using a US LLC?
Whats everyones thoughts on the USA not being a signatory for the Common Reporting Standard (CRS)?
Hi OC
I'm not able to find the answer to the following. Oversimplifying...
As I understand, selling a service or products (without being on the us) doesn't pay taxes on the uses.
Earning passive income from renting a house or any other real estate does pay taxes.
If you do both, do you pay taxes ONLY on the passive real estate income? or does your whole situation change and you are taxable on your full income?
Same question with any other investment like stocks or bonds.
Key thing I would say here is to not have a naked LLC as it could get taxed in the country of management and control. Always put the LLC under something like a UAE free zone company.
Hi, thanks for the helpful video. It’s clear that LLCs with no dependent agents in the US shouldn’t be subject to taxes. But let’s say I sell products through Amazon FBA in the US. This products are manufactured by a factory found in Alibaba. Then I send those products to Amazon USA. Wouldn’t this be considered ETBUS?
Thank you for sharing the relevant content! We have a similar case where a resident from India owns the US LLC which has been considered as disregarded entity. He has got registered address for the purpose of documents but is operating a drop shipping business. India has a tax treated with US. So two questions here:
1. Will that registered office address be deemed a permanent establishment?
2. If not, then will the Non-resident alien be end up paying no tax in US by way of treaty protection?
Yes Let us know I am in same satutaion Based in Pakistan
I am in same stiuation as well. Could you led us know if you have find out
Hi Michael,
Say I'm an Ireland company doing consultancy business in EU and all my employees, operations and customers are all in EU; yet I open-up a US LLC to invoice them and get payments to my US company account; what would be the condition?
* If I'm in a tax-free state like Wyoming, I have no state tax right? (Except franchise tax or any similar fees)
* How about federa witholding or income taxes that typically applies to non-residents as 30%?
Thanks
Hi. My question is this. I have a USA LLC Tax ID number on a property in Mexico. Will I have to pay capital gains tax to Mexico when I sell the property?
Great content Michael .
I'm still a bit confused on what makes the link between a foreign disregarded LLC on the income part when it comes to US income.
Let's say I'm an EU foreigner sitting in PT on an NHR status, and tomorrow i open a foreign sole owner LLC in Delaware and have only 1 client in the USA that is paying me for consultancy and contract remote sales work there.
Would that be considered disregarded for taxation or income that is connected to a US trade and hence needed to be taxed differently than what is suggested here?
if you could clarify that it would be great.
It's disregarded for US tax purposes by merit of being single member and not elected to be treated otherwise.
The question therefore is whether the member has any effectively connected income with US trade or business. In most cases if there's nothing taking place in the US it won't but it depends on the type of income.
Hi Michael,
thanks for your videos and all the information. One questions really makes me headaches and I can't put it together watching your other videos regarding this matter. What if the single LLC member is a foreign company? Still a disregarded entity? If the LLC has US broker account, are the dividends considered dividends by the owned public stocks or dividends by the LLC at the foreign company and particpation exemption applies?
Thanks!
Yes, if a single member LLC is owned by a company it is essentially the same as if it is in individual.
If there are dividends paid it is as though those are paid to the member so subject to the same withholding as if the member owned the shares directly.
@@MichaelRosmer A foreigner is subject to withholding tax on dividends through a U.S. brokerage? What is the U.S. tax scale for dividend withholding? The same a personal income tax brackets?
@@Timithos yes absolutely, dividends, interest, royalties and sometimes a couple other categories of income not to mention capital gains from the sale of real property are subject to withholding.
Withholding isn't at regular tax rates unless you're talking bout K1 partnership income. Otherwise withholding rates are fixed then reduced under the tax treaty so for dividends the base rate is 30% then under a tax treaty tends to be reduced to 5%-15% depending on the treaty
What if I store money in US bank that I earned doing business in US (yes I am non US resident and own LLC) , am I still taxable?
Thanks
Always a pleasure!
Do you own an LLC?
Hey Yes the IRS can disregard the entity because it has jurisdiction over it. But how can home country disregard the LLC as it has no jurasdiction over the LLC?
Thank you for the great, informative video!
My question is:
In the case of a French citizen (foreigner) forming LLC in US, and providing wine-tours in France to Americans, if the LLC has one employee in US for marketing and customer support, would the company paying all its taxes in US, or would the owner be still liable for taxes in France? Thanks!
I am not an accountant, but why would you have someone as customer support in the Us, when you can get at least the same work quality by getting a VA in the Philippines for 1/10 of the salary?
I didnt understand anything. He speak half an hour and zero info given. Bravo.
Everyone else understood it but you didn't. What does that say?
Hi Michael, can you guide me on where to search more about the definition of "trade or business" and "effectively connected income"? Thanks a lot
You need to read case law to get into that but before you do that or while you are doing so pay attention to the most important part that most people miss which is the definition of "in the US"
@@OffshoreCitizen What is important to understand about the phrase "in the US"? It seems reasonably straightforward to me, so now I wonder what I don't know.
Hi! thank you very much for the great explanation. I have a question: I am Spanish ( non - US resident with no office or employees ) and have the intention to run a conventional Wyoming LLC ( a "Disregarded" company by default). The business is about online consulting on business and technology ( for example, creating websites).I have asked some lawyers and public accredited accounts and, some of them have confirmed that I must only file 5472 and 1120, and other ones have confirmed that I must only file 1040R, as it is a disregarded company. Could you please let me know your feedback about it?
In case I must file 1040R, how would I be taxed on my income? ( I was told either 21% on my income or between 10% - 37%). Thanks in advance :)
Monica M , did you get the answer to your questions?
i have a question i have online business i have comic book website and my users are from all around the world and from us also i get traffic on my website from us also i'm i qualify for no tax if i form LLC ?
If i am a NRA with a delaware LLC and residing in a non tax treaty country, say UAE for example. Will my income be subjected to 30% witholding tax? My clients are in the US and i am selling design services. Would appreciate it you could clarify on the witholding tax.
I was recently watching one of your videos about LLC tax, I work as a freelancer for different countries. It so happened that I was invited by an American company to provide my services to them. This company will only give me work if it has a company open in the United States. So I thought about opening an LLC, I forgot to mention at the beginning of the text that I am not a resident of the United States, I am a resident of Europe. My question if you don't mind answering is whether I will be subject to US tax. I am a single person with no facilities in the United States, I will work remotely from my country where I will pay my taxes on any profits I make. Thanks!
Ps: I forget to say that my field is architectural and engineering consulting.
Did you find out a answer i cannot find it anywhere
What is confusing to me is how the income is taxed in the country where the operations are located.
I imagine one cannot simply open a sole owner US LLC while being resident in the EU, operate it from within the EU, and simply declare the income from the LLC as personal income in their home country. The income does not constitute dividends either. And there probably is a permanent establishment in the country where operations are taking place.
Is it required to set up a corporate structure in the country where operations are located? Otherwise, how is the US LLC income generally taxed in the other country since it is neither dividends nor a salary?
Hello,
I am a non resident and I received an EIN number. Do I need to have 147 verification letter or is it enough to have only CP 575 G letter? I only have CP 575 G, am I good to go or should I apply for verification letter 147? Thanks
Great piece of content. It is the same treatment for SMLLC and MMLLC? Could my clients file just a 1065? Obviously foreign owned MMLLC
Yes for multi member LLC you need to file 1065 form and for single member LLC you need to file 1120 and 5472 form.
Really great video. A quick question, I don't need to pay taxes. But do I need to file tax return forms. I have seen this in some videos, they say we still need to file few forms. Even if we are non USA .resident
Yes according to IRS instructions filing is must otherwise IRS gives you penalty NOTICE.
Great content with calming delivery. SO, if a Canadian (resident/citizen) opens a US LLC, he is not subjected to double taxation on the income?
More complex than that depends on the substance of the operations
@@OffshoreCitizen E-commerce
Very good video, I only missed one part of the theory which makes reference to a Foreing LLC's owners who has U.S personal accounts to receive payments from the LLC during the year. In that case, the owner will pay taxes based on those incomes into my personal U.S banking account? Thanks
Hello Offshore Citizen, I am curious to know what you would say are the best "banking" options for a "Wyoming LLC" (with a non-resident single member)? Are there plenty of good banking options (for a corporate bank account), or would you say that the banking options for the corporation are somewhat few and far between...? Thanks in advance for the reply & the good quality videos.
Did you find a answer ? Would you say mercury bank is good?
@@H80989 novo is okay theyre fdic insured for small biz it's CHECKING ONLY though; You get a debit card they are working on a CC though and Zelle. I used them as I am not based out of WY (LLC) but my biz is e-commerce. The plan is to (ASAP) register this as a foreign entity in my living state so my name is still anonynous (my industry I don't want ppl bugging me). Now I'm considering that and using a better bank, biting the bullet and hiring a CPA. BUT I am looking into offshore currently due to tax breaks and many other benefits. hope that helps Novo accepted me within 12 hours maybe??? NerdWallet rates them highly for 'start ups' but im getting out of that designation with our revenue being 150k this year alone.... AXOS took a MONTH and did not accept me no response or reason why this was also during the very beginning my income was low and we accept Bitcoin only.
Hello, Thank you so much this is the goldmine answer for my months and months question. I still have two more questions please: 1/ as a Foreigner let's say I have US LLC, I'm not taxable but does any sale that I make from US CITIZENS taxable? Like when I have to set taxes on shopify for example. 2/ As per as my research I'm from Madagascar and Madagascar has concluded tax treaties with Canada, France, Mauritius, and Morocco. No US; so as per as your video I'm taxable like the Americans or if there's no physical presence it's not applicable? Sorry I'm a bit confused. thanks and take care
No whether the client is a US citizen makes no difference in your tax.
A tax treaty doesn't generally matter but it depends on the type of income.
Hello, I established my foreign-owned disregarded entity in July 2022, should I file form 5472 now in 2022 or wait until 2022 ends then file it between jan and april 2023 for the previous year??
Hey Mike, thanks for the video!! Just wanted to clarify, I live in Germany but want to open a LLC in Wyoming and target the UK market. Would I only pay (income?) taxes in Germany?
Hi there, we are located in Germany, have an LLC in Wyoming and are doing business internationally. Doing business with the UK is particularly hard. You should consider moving the business to the UK right away if it is where you want to do business. Taxation is a pain in the UK!
@@acuitystudios5049 do you have to pay any tax on the federal level, if your operations are not in the US?
Ok so I would fall pretty much in your example, except I live in Canada not Cyprus. I have an LLC diregarded entity and no permanent establishment in the US so not taxable. Now what forms do I still need to fill at year end to be compliant with the IRS?
You need to file 1120 and 5472 forms.
So if I renounce U.S. citizenship, I'm now considered a foreigner to the U.S. I want the LLC in the US to access say like premium credit card payment processing, and maybe a couple other financial services that require an EIN (Employer Identification Number.) I have no personal real estate in the U.S. and I have no commercial buildings in the U.S., and no major contractors. (I assume those are American 1099 contractors.). I just have customers in the U.S. If I'm in St. Kitts, I just pay the business tax in St. Kitts, correct?
Well St. Kitts has LLCs so the income will be treated just like a St. Kitts LLC.
Note that foreigners can have a much harder time getting US processing but yes what you're saying is basically accurate.
Thanks, great info ! So are you saying that if I own SMLLC and alien non resident, but resident in a country that does not have tax treaty, I need to pay tax on US income ( even if there is no permanent establishment in US)
No I'm not saying that. Generally it is not taxable regardless but depends on the form of your income
@@OffshoreCitizen What if I store money in US bank that I earned doing business in US (yes I am non US resident and own LLC) , am I still taxable?
Thank you so much for the clear explaination! Just wondering since I will not be paying US taxes on my Llc and I live in the UK would I then need to register the Llc straigh away in the UK aswell?
The UK's treatment towards LLCs is a bit different. Probably best to reach out via our website or book a call with Michael
I would really appreciate feed back on this I've watched many of your videos but can't get my head around this. Say im in Ireland I set up an American llc in Delaware while resident in Ireland all the business operations is all online selling digital products so my llc is not taxable in America however Ireland and America do have a tax treaty im not sure if that means I pay 0 tax as im not sure if the tax treaty covers still being a resident in Ireland ? I think I would still be liable to tax in Ireland if so would it be the business rates in Ireland or as a sole trader ? if this is the case I may aswell just set up a business llc through my home country Ireland and pay the taxes ? any help would be appreciated thanks.
Detailed questions specific to you it's best to book a call but tax treaties don't much matter here, it's more about the substance.
Very often, though not always people are taxable in their home country in cases similar to the one you're describing. Not guaranteed but often.
Hi, thanks a lot for your information. Are you talking about both foreign owned single member LLC and foreign owned multi member LLC?
Thank you.
he is talking about foreign owned single member llc because if you have single member llc in US and you are foreigner as well then according to IRS you do not need to pay taxes.
@@muhammaddfaheem4566 wouldn't that be the same for multi member foreign owned LLC?
@@randomjonc for foreign owned multi member LLC you have to pay taxes on your income,
@@muhammaddfaheem4566 that's not what I heard from another CPA actually.
@@randomjonc tell me
How would this apply in the context of Amazon FBA? Or freight forwarder contractors? Would operations be considered as "in the US" or part of third party services?
If fulfilment is third party by an independent agent it is not their business in the US
Thanks you're the best. Please answer me. If a foreigner from Jordan started an LLC for dropshipping business to sell to US customers while he was living in Jordan. Will pay a tax?
what's in your opinion a better jurisdiction for an online business (selling courses & consulting), US LLC or UK LLP? for someone who is a resident of a country with non-zero personal income tax?
If you are non US citizen then US LLC is good for you.
Because single member LLC is disregarded entity for foreigners.
Hi,we are starting a truck dispatching company (llc) (non us resident operating in asia) and we just provide our time and services to other truck businesses IN the USA and charge them. We DONT have an office or an employee in the USA, are we included in the tax givers? What happens if we fail to pay tax as we assumed we are not taxable? as I am worried as differenct CPAs are saying different things to me
I would like to learn from your experience that what was the result of your practice? Have you paid the tax or you were not taxable as a non US resident?
Hi Michael
What's happening to the other part of the equation tho?
If the holder is a European country citizen for example Italian. How is this person get paid?
Are the profits considered as earnings and are subject to local tax? Or can the person get paid by dividends and pay dividend taxes?
Good question the answer is it depends by the country. In Australia for instance it is treated as partnership income and in Canada you get distributions as dividends.
This is why you've got to do careful tax planning and can't just try to apply one size fits all
If I am tax resident in a territorial tax country with no taxt treaty with US and I have stocks portfolio in US brokers, is there a legal way/structure to avoid paying the 30% withholding US taxes on dividends?
Great video! Thank you!
If I have an llc in US, and it is doing business in US (employees and inventory in US) what is the tax rate that applies? Does the llc have to file tax returns or the foreign entity?
Hope you can help with that!
Depends on the ownership structure and elections
Im a foreigner and I got my single member Wyoming LLC registered Feb 2021, got my EIN April 2021 .no bank account due to covid 19 local passport delays., the company have not started operations. Is my company eligible to pay any tax in USA with zero income and do i need to file tax return? Secondly to return file tax we need EIN or ITIN ?
Also if i wanted to add a local partner to my LLC that is resident in USA. how would my tax structure/ obligations change?
love it!!! would i make sense to get a LLC in Wyoming as a forex prop firm trader? I'm a german traveller
Great video michael, I have a question, i am currently a resident in spain, and i sell digital video games through a japanese online store, if i open a U.S LLC according to this video i shouldn't pay taxes in the US right? But what about in spain? since spain has an agreement with the US does that mean i should pay no income taxes here?
Depends on the details but you could easily end up getting taxed in Spain on that.
The best is to book a call and we can go over the specifics of the situation
Got my call booked! Too bad the Canadian dollar sucks so bad, it was trading at $0.70 to the USD according to PayPal.... oh well, totally worth it! Best content on the internet, can't wait to chat about options
Looking forward to connecting with you, Kevin.
Thanks for supporting our content!
@@OffshoreCitizen Is a background email generally helpful? Looking for the best options to leave Canada and prepare an exit so short term tax strategy, leading into future strategy, businesses, locations etc. I'm dual citizen with EU, gf is just Canadian but also has a Status card so there's lots going on. Should be fun!
You can send one but it's not necessary, we'll discuss it on the call regardless
C Corp can pay to foreign entities in form of expenses, So its tax liability can be 0 as well.
There are pretty low limits on this because expenses need to pass reasonableness tests and are subject to transfer pricing
I find this very confusing, according to you a foreign LLC doing sales in the US may not be taxed federal taxes provided there is no dependant agent and other objective variables even if income does come from the US? if it's true its really crazy
Hi Michael,
I have an LLC and I am going to perform services from my home country. I am waiting for EIN and I have put on line 6 of SS4 form (principal business location) my registered agent's address for my LLC. Should I have put there maybe my home country location? Will the IRS still know that I am performing services from outside of the US and that I have no US source income?
Thank you.
That won't make you liable for tax there
Hello francescoits been months since you filled for your EIN can i knw whether you tax or not as im about to fill for mine
If I form a Wyoming LLC to monetize CZcams (and AdSense payments), and assuming the production is done outside the US and contents has almost nothing to do with the US, would I be liable for US taxes?
amazon FBA with an LLC owned by a non us resident is taxable in usa?
Hey Michael,
If I don't have US sourced income and with US LLC I am not paying taxes in the US, would that change if I create a website for my LLC on US server (US domain) ? So I am providing services for US clients and I would like to get a website on US server for promoting my LLC. Would I start getting engaged in US trade or business in that situation? My home country doesn't have a tax treaty with US.
Thank you.
Typically a server shouldn't make you taxable if you weren't already but there could be ancillary things that do depending. Without knowing all the specifics I can't say for sure
hi, im not an us citizen and i live outsite usa, i have to create an llc before request my ein or i just have to fill and send SS4 form?? THAN YOU very much. I want to formalize my ecommerce (I sell worldwide).
Does that look the same when the owner have and EIN and ITIN numbers? Do those tax IDs entitle an LLC owner of paying U.S taxes?
No they don't these numbers don't create tax obligations they don't even create filing obligations
As a Canadian/Pakistani Dual citizen residing in Turkey, if I open a single-member LLC in USA for amazon FBA, will I be required to pay any taxes in US. I read mixed things. some have written that Amazon will be considered as dependent agent vs some mentioned otherwise. Please advice. Also, can husband and wife open a single-member LLC in US or will it be then considered a partnership instead of a single- member
You just need to file 1120 and 5472 forms according to IRS instructions.
For a New Mexico Llc you need a local agent. Is that considered a permanent employee?
So collect the VAT from a LLC pass through based in CY or not ^_^
Please guide me, what if we are providing online services and consultation from asia, and running llc as a single person, do we have to pay federal, state amd local income taxes?
For personalized advice please send a message through www.offshorecitizen.net
Thank you for this great video.
I am from Portugal an have qn online business that is regustered as single member llc in Wyoming and the compqny has US bank account. Do i need fill/submit any monthly/annually income/tax report/s in the US?
hello please how do you get to have a US bank account with your LLC and what bank do you use, I'm finding it difficult to get a bank account for my wyoming LLC
Descobriste uma resposta? Estou na mesma situação neste momento
@@RikkilousPT ptobably the safe side is yes. It depends.First you must file the 1120-5472.
About NR1040, If the compqny has some activity in the US then you should fill the NR1040 report. Because having servers in the US might be US activity, I did file the NR1040 as well, it was according to recommandation of a CPA. When you filed it I did it as resident of portugal and said I will pay the relevant taxes in Portugal. In Portugal I file the annual report and pay the relevant taxes to my profiles as they reported on the 1040 report.
What if I store money in US bank that I earned doing business in US (yes I am non US resident and own LLC) , am I still taxable?
Same in mind, this is a good question, can anyone help answer this? Thanks
Would fulfilment services (third party logistics/3PL) for e-commerce be considered as a dependent agent ?
Good question. From what I heard, 3PL are their own registered entities and they provide the same service for other companies, so in that sense they cannot be seen as a dependant agent. As they don't depend on your business.
@@taj-sid I heard the same thing as well . So that would be the same thing if I hire a digital agency that runs my facebook/google ads right ?
@@alexrappoport2911 Pretty much
However fulfilment providers may make you fall into the state nexus (state sales tax) so that something to consider. I am sure Michael can elaborate...
Yeah, third party logistics companies would typically not qualify as dependent agents (note if you're renting warehouse space, have an employee there, etc. that is a different matter, although if you're protected under a tax treaty that might not be an issue because warehousing doesn't qualify as a permanent establishment under some tax treaties)
Im not really sure where to start with tax laws as they can be quite complex but i was hoping you could help me out.
I am canadian and wanting to take advantage of the larger market in the US for government contracting. So far it seems like i require a us llc so delaware, wyoming, or new mexico make sense with no state income tax. You mentioned having someone in the us would be taxable, does the registered agent count, or the subcontractor i would be hiring?
And also do i need a physical address in those states(apparently the government wont really accept virtual addresses) ?
If i use an llc taxed as a c corp i can be paid by the business which would be taxable in canada and if its taxed as a sole prop, well i could be sued so that wont happen..
Am i correct?
Thanks for any insight
For any specific advice please send a message through www.offshorecitizen.net
Super video.
But can you explain if I had a Delaware LLC that is owned by a Seychelles IBC that charges my Uk company interest on loans it has made to the UK company. Would taxes be paid in the US?
Depends on operations, also you might need to worry about transfer pricing and thin capitalization
@@OffshoreCitizen thanks for this. Didn’t even know that thin capitalisation was a thing in the UK. If the UK company is a property investment company so just brought and held property could it be argued that having high leverage is ok as you are interested in capital appreciation?
I have a question. If I register an LLC for providing software development services and I'm not a US resident but if I have a US client then do I have to pay tax? And if I have a client outside of the US do I have to pay tax?
Depends on where you and your team are working. Also note you could be taxable elsewhere
@@MichaelRosmer what if its a mm llc? Theyre working outside the US
So if me and my sister, open an LLC for bank purposes but I operate in Peru, we do web design. Do I file an NR 1040. Do I need an ITIN number? Do I file a 1065 partnership?
Regardless of the corporate tax question:
If such an LLC owned by a foreign non-US person pays dividends to the share holders, wouldn't there be a requirement to withhold 30% (Or less with a tax treaty)?
No, LLCs don't pay dividends the income of the LLC at least when it is treated as a disregarded entity is the income of the member
Is ownership in single owner US LLC liable for US estate tax (foreign owner of US company)?
What if I established an llc in is to sell online on USA with dropshipping site and my residence in egypt?
Can you expalin please and also waht is the best state?
Very great video! So, If I'm Canadian and open a business consulting llc in the US (also have ITIN), would I be double taxed? Can I book a consultation with you?
Probably best to book a consultation to discuss all the details calendly.com/michael-rosmer
As a tax resident of Malaysia (I am Canadian) would I pay taxes on income brought into Malaysia, from the US LLC?
Hi there! Thanks for the video! I saw an account saying that foreigners owning a company in the US should pay the Bureau of Economic Analytics, no matter the size of the company. Is that true?
Say what? No not at all
@@OffshoreCitizen thanks!
Hey Michael, if I have an LLC, working as a freelancer online from another country for private clients, do I still need a working visa? Or would this process of not paying taxes in the US compromise a future green card application?
This is completely independent of visa requirements
@@MichaelRosmer highly appreciated! Following your channel!
As a foreign person who established a single member US-based LLC to manage the CZcams channel from my country, this may suggest that the income is effectively connected with a US trade or business or not? Also do I need ITIN or only EIN number in this case? (my state doesn’t have treaty tax agreements with US). THANK YOU
EIN only, ITIN not needed
Other details please reach out to us
So does this mean that foreign disregarded entities LLC that works on amazon selling and e-commerce won't pay federal taxes?
Assuming it has no ECI with US Trade or Business yes it means that for US tax, doesn't mean it won't be taxable elsewhere.
May I have a LLC company which do business in US at 21% tax (real estate) and, at the same time, do business at stock exchange 0% tax?