Company formation in the USA - Setting up an LLC or Corporation
The US LLC is the most commonly used legal structure in the USA. What makes the US LLC special is that it can be founded by almost anyone. It is a hybrid form:
From a corporate law perspective, it is considered a capital company due to its limited liability. From a tax law perspective, it can be classified as either a capital or a partnership, depending on the specific structure.
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General Information about the US LLC
The US LLC is the most commonly used legal form in the United States. Currently, an average of about 500,000 US LLCs are registered each month in the United States.
It is a unique legal structure from our legal perspective, as it allows limited liability, even though it is not necessarily considered a separate tax entity from the perspective of the USA. The LLC makes it easy to conduct business both domestically and globally, and it enjoys an impeccable reputation worldwide!
Key facts about the USA
- NATO member since 1949
- Official language: English
- Capital: Washington D.C.
- Form of government: Federal presidential constitutional republic
- Population: 331.9 million (2021)
- Gross Domestic Product: 23.32 trillion USD (2021)
- Internet TLD: .us
- Currency: Dollar (USD)
- Country calling code: +1
Key facts about the tax system in the USA
- Complex tax system
- Taxation at the national and state levels
- No value-added tax (VAT), but sales tax in some states
Important developments
Implementation of Executive Order 14071
Introduction of the Beneficial Owner Information Report
Comprehensive sanctions against Russia
Company Formation in the USA
US LLCs are particularly popular due to their quick formation and low requirements (no minimum capital or notarization required). We are able to establish your LLC in just a few business days and provide you with the corresponding tax identification number. This enables you to immediately open a business account and begin operations.
The process for forming a Corporation is similar, though different deadlines and obligations apply. We establish and manage US companies in nearly all 50 states and assist our clients with opening business accounts. All from a reliable source.
Target Audience
A company formation in the USA in the form of a US LLC or Corporation is often used by so-called “digital nomads” to conduct business. E-commerce sellers, such as those running Amazon FBA and wishing to operate in the USA, also make use of US LLCs. Additionally, a US LLC can be used to protect assets outside the European Union. Real estate investors frequently turn to LLCs, which is quite common in the USA.
Advantages
- Extremely fast company formation (5-10 business days)
- In combination with a bank
- account at a US bank, a US LLC can be effectively used for asset protection, as there is no automatic information exchange (= Common Reporting Standard).
- Various options for opening a business account
- Access to the US market, creditworthiness in the USA, and American credit cards
- Discretion in the business registry (e.g., in Wyoming, Delaware)
- Impeccable reputation and international recognition
- No tax obligation for the US LLC in the USA – with proper structuring
Legal forms in the USA
What legal forms exist in the USA? The most common legal forms are undoubtedly the LLC and the Corporation, while the legal form for sole entrepreneurs is called Sole Proprietor. However, from a tax, social security, and liability perspective, the Sole Proprietor status is usually not a good choice.
Business account
There are many ways to open a business account for a US LLC. Some options are free and can be opened “on your own.” Other options require some knowledge of dealing with American financial institutions. We are happy to assist you with the account opening for your US LLC.
Taxes and fees
If the following conditions are met in their entirety, a US LLC is tax-exempt in the USA:
- Single-Member LLC (LLC with only one member)
- The member is not a US citizen
- The member is not subject to unlimited taxation in the USA
- The member is not a resident of the USA
- The company does not maintain a permanent establishment in the USA
- The company does not employ dependent workers in the USA
Note: Even if the US LLC does not trigger income taxes in the USA under the conditions mentioned, you should clarify your individual tax obligations with your trusted tax advisor in the country where you are liable for taxes.
Filing obligations
In addition to rights, there are also numerous obligations that a US LLC may incur:
- Annual Report (Secretary of State)
- Individual Income Tax Report Form 1040 (IRS)
- Partnership Income Report Form 1065 (IRS)
- Corporation Income Tax Return 1120 (IRS)
- Form 5472 (IRS)
- FBAR (FinCEN)
- Beneficial Ownership Information Report (FinCEN)
Note: All filings must be submitted on time, otherwise severe fines and imprisonment penalties may apply. You can handle this yourself, or you can simply hire us, and we will take care of it reliably.
The choice of the right state
Which state is the right one? Key criteria:
- Residence of the member
- Privacy in the public register
- Costs with the Secretary of State
- Availability of company names
- Local laws and regulations
- Asset protection
Requirements
- Age of majority
- Legal capacity
- Completed and signed questionnaire
- Signed power of attorney
- No sanctioned citizenship
Process
- Order placement and payment via our website
- Submission of our questionnaire (received after your order)
- Submission of your valid proof of identity
- Submission of the power of attorney prepared by us and signed by you
- Company formation by representation via power of attorney (3 – 10 business days)
- Application for the EIN in express procedure (3 business days)
- Submission of the Beneficial Ownership Information Report
- Optionally, we can assist you with the account opening
Company Formation in the USA: Service Overview
- Company Formation USA – LLC or Corporation
- Reservation of Company Name
- Registered Address (12 months)
- Registered Agent (12 months)
- Preparation of all Powers of Attorney
- Creation of the Operating Agreement
- Registration with the Commercial Register
- State Filing Fees
- Application for EIN (Express procedure, max. 3 business days)
- Compliance Watch
- Beneficial Ownership Report
- First-class Customer Service
Support by a licensed tax advisor in the USA
If you have tax-related questions, we are happy to connect you with a licensed tax advisor in the USA (Certified Public Accountant). This tax advisor specializes in the needs of non-resident foreigners. We have been working with him trustfully for many years.
Especially if you own real estate in the USA or are uncertain about your tax filing, he can provide excellent support in navigating the complex tax laws of the USA.
Hundreds of clients rated us with "Excellent"
How we can assist you
Company Formation abroad
Entrepreneur-friendly conditions in over 10 countries
Residence abroad
Administrative registrations for your fresh start abroad
Foreign accounts
Accounts in the safest places in the world
Foreign real estate
Value preservation, value appreciation, and positive cash flow
Schedule your non-binding initial consultation
Together we will figure out how we can help you to achie your goals.
