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Formation

LLC for Non-Residents: Eligibility, Costs and Decision Checklist

Decide whether a US LLC fits your nonresident business: ownership eligibility, entity choice, state costs, banking checks and tax reporting.

By OpenStates Team ·

A US LLC can be an option for a founder living outside the United States who needs a business entity for contracts, payments or operations. Ownership generally does not require US citizenship, an SSN or a visa, but banking and processor eligibility are separate decisions. This overview helps you decide whether an LLC fits your ownership, tax exposure, activities and budget before following a formation checklist. It does not promise formation, banking and payments in under three weeks. Further reading: OpenStates

Can a non resident actually own a US LLC?

Yes — and there are no restrictions on how much of the company a non-resident can own. A single foreign founder can be the sole 100% owner. There is no requirement to have a US partner, a US director, or any local presence beyond a registered agent (which costs roughly $100/year and is included in most formation packages).

Nonresident aliens cannot be S corporation shareholders. LLC ownership and C corporation ownership are generally available to foreign persons, but an LLC is not the right answer for a fixed percentage of founders. Compare investor requirements, partner arrangements, regulated activities, sanctions restrictions and treatment in your country of residence.

What you need before you start

  • A valid passport from any country
  • A residential address in your home country
  • An LLC name that's available in your chosen state
  • A US registered agent (almost always bundled into the formation fee)

That's it. No SSN, no ITIN, no US bank account, no US phone number required to start. You'll add those pieces after the LLC exists.

Choosing a state for your nonresident LLC

For a non-resident with no physical US operations, three states stand out:

  • Wyoming — $100 state formation filing; annual license tax is $60 or 0.0002 × Wyoming assets, whichever is greater. Consider operations elsewhere and independent banking eligibility; no invented percentage of founders is recommended.
  • Delaware — $90 filing, $400/year franchise tax. Worth it only if you plan to raise venture capital from US investors.
  • New Mexico — $50 filing, no annual report at all. Cheapest long-term, but weaker brand recognition with US banks.

We cover the full breakdown in our Non-Resident LLC hub, including a side-by-side comparison matrix and which state each type of business should pick.

Step-by-step formation process

  1. Pick a state consistent with your operations and check LLC name availability in its official registry. A name search is not trademark clearance; check branding separately.
  2. Appoint a registered agent. They receive legal mail on the LLC's behalf and must have a physical address in the formation state.
  3. File the Articles of Organization. This is the document that legally creates the LLC. Approval takes 1–7 business days in most states.
  4. Apply for an EIN using the route allowed by the IRS. Online eligibility depends on the business location and responsible party tax ID, not nationality alone; international applicants may use the phone, fax or mail process when applicable. Further reading: our full EIN walkthrough
  5. Apply for banking only after checking each provider’s permitted owner countries, industries and addresses. Mercury, Relay and Wise have distinct products and eligibility policies; an LLC and EIN do not guarantee approval.
  6. A foreign-owned US disregarded entity must file Form 5472 attached to a pro forma Form 1120 for a year with reportable related-party transactions. Owner contributions, distributions, loans and payments can qualify, including formation funding with zero revenue. Review each tax year separately: a prior formation contribution does not itself create a transaction in every later year. Other classifications and filing exceptions require separate analysis. Keep the registered agent active and meet applicable state filing deadlines.

How much does a non-resident LLC actually cost?

Build a budget from separate items: state formation fee, agent renewal, mailing address, provider subscription, annual state tax or report fee, bookkeeping and any needed professional tax preparation. IRS EIN applications themselves are free. Do not assume one generic DIY range covers every business or that reminders include filing.

OpenStates currently lists nonresident setup at $247 one-time and resident setup at $197. Pay As You Go is $15/month for the standard address or $25/month for the county address; Basic is $49/month and Premium is $99/month. CPA services are separate. Consult /pricing for current inclusions, renewal terms and exclusions; these figures are not a promise that state fees or all tax preparation are included. Further reading: transparent pricing page

Common mistakes non-residents make

  • Forming in California or New York just because they're famous. Both states impose franchise taxes ($800/year minimum in CA) on out-of-state owners.
  • Using a virtual mailbox as the registered agent. Most don't qualify; you need a true registered agent service.
  • Skipping Form 5472. Single-member foreign-owned LLCs must file this for a year with reportable related-party transactions, including contributions or distributions even with zero revenue.
  • Treating the entity choice as a provider choice. Stripe Atlas supports Delaware LLCs as well as C corporations. Choose the tax and ownership structure first, then compare providers and renewals.

The fastest path

OpenStates handles every step above as a single flow — formation, registered agent, EIN filing, bank account introductions, and Form 5472 reminders — with no SSN, no US address, and no surprise fees. See pricing, read our OpenStates review, learn about us, or compare with the best state breakdown and the EIN walkthrough.

Frequently asked questions

Can a non-resident own 100% of a US LLC?

Yes. There are no restrictions on how much of a US LLC a non-resident can own. A single foreign founder can be the sole 100% owner with no US partner, no US director, and no local presence beyond a registered agent. The only entity type that restricts foreign ownership is the S-Corp — LLCs and C-Corps are both fully open to non-residents.

Do I pay US tax on an LLC I own as a non-resident?

US tax is not determined by the absence of an office alone. A single-member LLC is generally disregarded unless it elects corporate taxation, but the owner may owe US tax on effectively connected income (ECI) or US-source fixed, determinable, annual or periodical (FDAP) income. FDAP is generally subject to 30% gross withholding unless a treaty or other rule reduces or removes it; ECI is generally taxed on a net basis. Home-country treatment depends on local law, entity classification and treaty relief, not a universal rule that every owner always pays tax at home. A foreign-owned US disregarded entity must file Form 5472 attached to a pro forma Form 1120 for a year with reportable related-party transactions. Owner contributions, distributions, loans and payments can qualify, including formation funding with zero revenue. Review each tax year separately: a prior formation contribution does not itself create a transaction in every later year. Other classifications and filing exceptions require separate analysis.

Can I get a Stripe account with a non-resident LLC?

A US LLC and EIN can support a banking or processor application, but do not ensure acceptance. Each provider reviews owner country, industry, identity, addresses, business activity and source of funds. Remote onboarding is possible only where the provider permits it; approval time, account details and fees vary. Check the provider’s current eligibility before paying for formation solely to obtain an account.

Do I need to visit the US to open a business bank account?

An in-person visit is not always necessary. Some providers offer remote applications for eligible nonresident owners, while others require a branch visit. Check the provider’s current country, industry, identity and address requirements before applying; remote onboarding is not a guarantee of approval.

What's the biggest mistake non-residents make with US LLCs?

A foreign-owned US disregarded entity must file Form 5472 attached to a pro forma Form 1120 for a year with reportable related-party transactions. Owner contributions, distributions, loans and payments can qualify, including formation funding with zero revenue. Review each tax year separately: a prior formation contribution does not itself create a transaction in every later year. Other classifications and filing exceptions require separate analysis. When a required Form 5472 is missing, late or substantially incomplete, the IRS can assess a $25,000 penalty. Continued failure after 90 days following IRS notice can lead to an additional $25,000 for each related party for each 30-day period or part thereof. Reasonable-cause relief depends on the facts; neither zero revenue nor an informal checklist guarantees relief.

Decision checklist: when an LLC may fit—and when to pause

Write down the specific commercial reason for the entity: customer contracting, liability separation, marketplace requirements or an eligible payment relationship. Then identify the actual owners and where activities take place. LLC ownership does not confer immigration status or permission to work physically in the United States. Provider restrictions and regulated-industry rules remain separate from state formation eligibility. Do not purchase a structure solely because a marketing page says it unlocks payments.

Pause for professional advice if investors require stock, partners need different allocations, US inventory or agents are involved, or your home country treats a US LLC as a corporation. A disregarded federal classification is not a universal cross-border tax result. Ask about ECI, US-source FDAP, withholding, local reporting and relief before comparing service packages. Once the structure fits, the separate formation guide provides the execution sequence; this overview is the decision point, not a guarantee of eligibility or completion time.

Continue with the formation decision

Move from the eligibility decision to documents, formation and the operating agreement.

Sources

This article is general information, not legal or tax advice.

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