Setting-up Limited Liability Corporation (“LLC”) in US

In the US, there is more than one way to set up a business with no mandatory requirement for citizenship to operate a business. An LLC is a type of recognized and accepted business entity for small business owners. The main purpose of an LLC company is to limit the personal liability of its owners. The main advantages of having a US LLC to start a business in the US includes:

Owners are considered self-employed when LLC is taxed as a proprietorship or partnership. In such a scenario, Owners will have to pay social security and Medicare taxes on their full share of profits. Where LLCs opts to be taxed as S-Corp and Owners draws salary, then, social security and medicare taxes will be paid on salary withdrawal and not on entire profits. Further, like other employees, Owner can participate in profits sharing plans 401K – retirement savings plans.

Apart for doing small business, LLCs in US is preferred option, with or without umbrella LLCs, for making investments in real estate properties giving benefits of asset protection, to delink risks between two property, anonymity, estate planning, tax efficiency, etc. ?

Typically, for incorporating LLC in US, non-US citizen will have to start with following steps:

• Select state to do business (Florida, Texas, Nevada, Delaware are popular options)
• Choose a business name?
• Prepare operating agreement
• Hire registered agent and file article of organization?
• Obtain TIN as Non-US citizens will have not got EIN
• Open business account?
• Get a business license and permits

Non-US citizens can own a limited liability company (“LLC”) and a C-Corporation but not an?S-Corporation in the US to do their business operations. Further, foreign owners of US LLC must evaluate the structure to achieve tax efficiency considering tax treaty entered between home country and US as well as evaluate tax implications under the local tax laws.

With?Fernandez Young, CPAs and Business Advisors, you'll have the added advantage of US CPAs leading the team and coordinating with lawyers / attorneys while providing the valued-added services to the clients. For more information or clarifications, contact?Urvesh Patel?at?[email protected] and our team is ready to assist you.