Knowledgebase
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Basics
Articles of Organization
The official papers you file to start an LLC. They tell the state who you are, where you’re located, and who’s responsible for receiving legal documents. Once approved, your LLC becomes a legally recognized business entity.
Original Filing ID
The official papers you file to start an LLC. They tell the state who you are, where you’re located, and who’s responsible for receiving legal documents. Once approved, your LLC becomes a legally recognized business entity.
Operating Agreement
The official papers you file to start an LLC. They tell the state who you are, where you’re located, and who’s responsible for receiving legal documents. Once approved, your LLC becomes a legally recognized business entity.
EIN Letter
The official papers you file to start an LLC. They tell the state who you are, where you’re located, and who’s responsible for receiving legal documents. Once approved, your LLC becomes a legally recognized business entity.
LLC (Limited Liability Company)
The official papers you file to start an LLC. They tell the state who you are, where you’re located, and who’s responsible for receiving legal documents. Once approved, your LLC becomes a legally recognized business entity.
C-Corp (C Corporation)
The official papers you file to start an LLC. They tell the state who you are, where you’re located, and who’s responsible for receiving legal documents. Once approved, your LLC becomes a legally recognized business entity.
SSN / ITIN
The official papers you file to start an LLC. They tell the state who you are, where you’re located, and who’s responsible for receiving legal documents. Once approved, your LLC becomes a legally recognized business entity.
Resolution of Organizer
The official papers you file to start an LLC. They tell the state who you are, where you’re located, and who’s responsible for receiving legal documents. Once approved, your LLC becomes a legally recognized business entity.
Who can found a company
A company can be founded by
A single individual
Multiple individuals
A single company
Multiple companies
An individual and a company
Multiple companies, same founder
A founder can start as many companies as they choose. There are no restrictions or limits on how many businesses one person can form, and each company will be treated as a separate legal entity once registered with the state.
Multiple businesses, same company
It’s possible to run multiple businesses under one company, and there are no legal restrictions. Still, separating each into its own entity can make bookkeeping, accounting, and risk management clearer. Not required by law, but often a smarter way to keep operations organized as you grow.
Reporting your US company in your home country
Most governments require citizens or residents to report when they own or invest in companies abroad. Rules vary by country, but reporting foreign company ownership is common. To remain compliant, consult a local advisor who can explain the specific requirements that apply to you.
Changes in a company
How to change the name of my US company?
If you manage everything yourself (file annual reports, file tax returns, etc), about $250 a year. If we manage everything for you, it will cost you $590 a year or $1190 with bookkeeping included. If you want to use additional services from an accountant, add articles to the deed of incorporation, etc., this entails additional costs.
Change in ownership percentage or equity
Each LLC must submit an annual report to the Secretary of State, submit tax forms to the IRS, and report beneficial owners to the FinCEN.
All the reports are included in our packages.
Change of address
It is better to have bookkeeping than not. We offer full bookkeeping service with our Managed Plus package.
If you are on the Managed package ($590 a year), that doesn’t include bookkeeping. However, for preparing your tax forms we will need your balance sheet and your profit/loss statement. To have them, you need someone to handle the bookkeeping (you or someone else).
Conversion of structure
For our subscribers, it is free of charge. We’ll handle the paperwork and cover the costs of dissolution. We’ll walk you through the necessary steps you need to take and cover the expenses of closing your company.
Banking
Traditional banks
Traditional banks are brick-and-mortar financial institutions with physical branches. Examples include Chase, Citibank, Bank of America, Wells Fargo, and others. They offer a full range of services like checking and savings accounts, credit cards, loans, and international transfers. They often have stricter requirements for opening accounts, especially for non-residents, and may require in-person visits.
Traditional banks in almost all cases require you to appear in a physical branch on US soil to pass the KYC checks to open an account. In some cases remote opening is possible, but you’ll be required to know the right banker and to deposit $25-100.000.
Neobanks
Neobanks are fully digital banks with no physical branches, offering modern, app-based banking with lower fees and faster onboarding. They are not licensed as traditional banks themselves. Instead, they use the infrastructure of partner banks to provide business bank accounts and related services.
They are popular with global entrepreneurs because they often support remote account opening and multi-currency accounts, which is why we partner with them.
Examples of neobanks (also called online banks or fintech banks) include Mercury, Brex, Meow, Levro, and others. Some require a physical presence in the US, such as an office address. Others require founders to have an SSN.
However, there are also options that work with international addresses and no SSN, and we focus on these while continuously exploring new possibilities.
Payment processors
Payment processors handle the technical side of accepting online payments from your customers. They connect your business, your customer’s bank, and your own bank account. Examples include Stripe and PayPal.
A payment processor allows you to accept credit cards, debit cards, and sometimes alternative payment methods like Apple Pay or Google Pay.
You can accept bank transfers for invoices without a payment processor. You need a payment processor only if you want to accept card payments.
EMIs
Electronic Money Institutions (EMIs) are licensed to hold customer funds electronically and process payments, but they are not banks. They usually offer accounts with IBANs or local account numbers, cards, and international transfers. Funds held with EMIs are typically safeguarded, but in most cases are not covered by deposit insurance like traditional bank accounts.
Examples include Wise and Payoneer.
How to deposit money to your bank account
You can deposit money into your business account in several ways:
Receive customer payments through your payment processor or by direct bank transfer. Depending on the provider, you may need to link your business bank account or verify company details before deposits can be approved and funds are released to your account.
Transfer funds from another bank account you own. In some cases, your local bank may ask for a Decision for Capital Contribution from the company to approve the transfer
Accept wire transfers or ACH payments directly into your account. With services like Payoneer, Wise, or Revolut, you can add funds to activate the account. These services typically don’t ask for a Decision for Capital Contribution from the company to approve the deposit.
Deposit cash at your bank’s branch or an approved partner location. This option is usually available with traditional banks but not with most neobanks or EMIs. Some banks may also require proof of the source of funds before accepting larger deposits in person.
Always keep a record of the deposit in your bookkeeping
software to ensure accurate financial tracking.
Withdrawing money
Personal account
You can transfer money from your business account to your personal account as long as you record it properly. The method depends on your company’s structure and tax treatment. Always keep personal and business accounts separate to maintain clean records and protect your liability shield.
Owner draw
money is often taken out as an owner draw. This means profits are transferred to the owner without being treated as salary. Draws themselves are not taxed at withdrawal, but the profits are taxed in the annual return. Always record draws clearly in your bookkeeping software as owner distributions.
Dividend
If your LLC is taxed as a C-Corp, payments to owners are called dividends. These come from after-tax profits and are taxed again on your personal return, creating double taxation. For non-residents, dividends are taxed in the U.S. at a default 30% rate, unless a tax treaty with your country lowers it.
Investing through LLC
You can invest directly through your LLC’s bank account, such as purchasing shares, real estate, or digital assets. All investments must be in the name of the LLC, not your personal name, and recorded as company assets. This ensures they remain legally tied to the business and may provide liability protection and tax benefits.
Taxes
Income tax
Income tax is the tax your business or you as the owner pay on profits. For US LLCs owned by non-residents, the income tax rules depend on whether the LLC is treated as a disregarded entity (single-member LLC) or a partnership (multi-member LLC). In many cases, if your LLC has no income that is effectively connected with a US trade or business, you may owe no US income tax — but you still need to file certain IRS forms to stay compliant.
Income tax forms and deadlines
Multi-member LLC
Multi-member LLCs file Form 1065 (U.S. Return of Partnership Income) by March 15 each year. Each member also receives a Schedule K-1 showing their share of profits or losses.
Single-member LLC
Single-member LLCs file Form 1120-Pro Forma with Form 5472 by April 15 each year. These forms report specific transactions between the LLC and its foreign owner, ensuring the IRS has a record of activity even when the company itself does not owe income tax.
Nonresident Individual
Nonresident individuals with U.S.-source income must file Form 1040NR (U.S. Nonresident Alien Income Tax Return). The deadline is April 15 each year, or June 15 if you have no U.S. wages. This form reports your taxable income and ensures compliance with IRS rules.
FDAP income
FDAP stands for Fixed, Determinable, Annual, or Periodical income. It includes passive income such as interest, dividends, rents, royalties, and certain types of payments from US sources to foreign persons.
For non-resident LLC owners, FDAP income is generally subject to a 30% withholding tax by default, unless a tax treaty between the US and your country reduces the rate. Unlike business profits, FDAP income is taxed on the gross amount (no deductions for expenses) and is reported separately from effectively connected income (ECI).
If your LLC earns FDAP income, the payer is usually responsible for withholding the tax and sending it to the IRS. You may need to provide them with a W-8BEN form to claim any treaty benefits and ensure the correct withholding rate is applied.
Sales tax
Sales tax is a state-level tax on goods and some services. Whether you must collect it depends on what you sell, where your customers are located, and whether your business has nexus in that state. Nexus means a sufficient connection, such as sales above a threshold, having inventory, or operating with employees or contractors in that state. Most states require sales tax collection once you pass certain thresholds. In many cases, this means $100,000 in sales or 200 separate transactions in a year. You can see the full list of thresholds here. Services are generally exempt, and software is exempt in many states as well. To track exposure, you can use tools like the free version of our partner Numeral, which monitors sales tax nexus across states. If you are required to collect sales tax, you must register with the state, add tax to your invoices, and remit it on a regular basis—monthly, quarterly, or annually, depending on state rules.
How to get the tax bill to zero
If your US LLC has no effectively connected income (no taxable US-source income) and you meet all filing requirements, your federal income tax bill can be zero. This typically means:
- Your business activities and sales take place entirely outside the US
- You have no employees, inventory, or physical presence in the US
- You correctly report and document all transactions on the required IRS forms
- You pass the substantial presence test as described on this link.
However, you still must file all required forms on time to avoid penalties. Some states also have their own annual fees or franchise taxes regardless of income, so “zero tax” applies only to federal income tax in most cases.
Employees and Contractors
Employees and contractors
Your company can hire both employees and contractors. Employees work under employment contracts, while contractors provide services under a services contract. Employees of a U.S. company must be authorized to work in the country, which means being a citizen, green card holder, or having a valid work permit. Contractors, on the other hand, can be based anywhere in the world, as long as they are not located in a sanctioned country such as Cuba, North Korea, Venezuela, or Iran. Unlike employees, contractors are self-employed and responsible for their own taxes, tools, and work arrangements. Employees are usually on payroll, with taxes withheld, benefits provided, and labor laws followed. They often have long-term roles. Contractors are typically hired for specific projects or time periods, giving companies more flexibility without the same legal obligations.
Vesting
Vesting is the process by which someone earns the right to own company shares or stock options over time. It’s often used to motivate and retain employees, co-founders, or advisors.
For example, if you grant someone 4% of the company with a 4-year vesting schedule, they don’t receive the full 4% immediately. Instead, they earn it gradually (e.g., 1% per year), sometimes with a “cliff” — a minimum period (often 1 year) before any shares are earned.
If the person leaves before the vesting period is over, they keep only the portion that has vested, and the rest returns to the company. This helps protect the business from giving away ownership to people who don’t stay long-term.
Bookkeeping
Invoices
Traditional banks are brick-and-mortar financial institutions with physical branches. Examples include Chase, Citibank, Bank of America, Wells Fargo, and others. They offer a full range of services like checking and savings accounts, credit cards, loans, and international transfers. They often have stricter requirements for opening accounts, especially for non-residents, and may require in-person visits.
Traditional banks in almost all cases require you to appear in a physical branch on US soil to pass the KYC checks to open an account. In some cases remote opening is possible, but you’ll be required to know the right banker and to deposit $25-100.000.
Bill payments
Neobanks are fully digital banks with no physical branches, offering modern, app-based banking with lower fees and faster onboarding. They are not licensed as traditional banks themselves. Instead, they use the infrastructure of partner banks to provide business bank accounts and related services.
They are popular with global entrepreneurs because they often support remote account opening and multi-currency accounts, which is why we partner with them.
Examples of neobanks (also called online banks or fintech banks) include Mercury, Brex, Meow, Levro, and others. Some require a physical presence in the US, such as an office address. Others require founders to have an SSN.
However, there are also options that work with international addresses and no SSN, and we focus on these while continuously exploring new possibilities.
Software
Payment processors handle the technical side of accepting online payments from your customers. They connect your business, your customer’s bank, and your own bank account. Examples include Stripe and PayPal.
A payment processor allows you to accept credit cards, debit cards, and sometimes alternative payment methods like Apple Pay or Google Pay.
You can accept bank transfers for invoices without a payment processor. You need a payment processor only if you want to accept card payments.
Business expenses
Business expenses are costs you incur to run your company. Common examples include office rent, employee and contractor salaries, inventory, external services, marketing, software subscriptions, travel, utilities, and equipment.
Tracking these expenses is important for budgeting, financial reporting, and claiming tax deductions. To be deductible, the expense must be ordinary (common for your industry) and necessary (helpful for running your business).
You should never mix business and personal expenses. Using your business account only for business transactions ensures your bookkeeping stays clean, your financial reports are accurate, and your tax calculations are correct. Mixing expenses can make it harder to track deductions, increases the risk of errors, and may cause issues if your records are ever reviewed by tax authorities. Keeping accounts separate also reinforces the legal separation between you and your business, which is important for liability protection.
Raising Capital
Angels
Angel investors are individuals who invest their own money into early-stage companies in exchange for equity (ownership) or convertible debt. They often provide smaller amounts than venture capital firms but can be more flexible and faster to work with. Angels sometimes bring valuable experience, mentorship, and industry connections in addition to funding. While angels can invest in any type of company, they generally prefer C-Corps because of the standardized share structure and clearer exit options.
VC
Venture capital (VC) firms invest larger sums of money into high-growth companies, usually in exchange for equity. They typically look for businesses with strong growth potential, scalable models, and large target markets. VC funding often comes with more rigorous due diligence, formal agreements, and expectations for rapid growth and eventual exit (sale, IPO, or acquisition). Most VCs strongly prefer C-Corps, with Delaware C-Corp being the most popular structure due to its investor-friendly corporate laws, though they can invest in companies from other states as well.
Loans
Business loans are borrowed funds from banks, credit unions, or online lenders that must be repaid with interest. Loans can be secured (backed by collateral) or unsecured. They allow you to keep full ownership of your company but require steady revenue or a strong credit history to qualify. In the US, loans are generally available only to individuals with both a credit score and an SSN. Repayment schedules are fixed, so you need to ensure your cash flow can handle the obligation.
Merchant Cash Advance
A merchant cash advance (MCA) provides a lump sum of cash in exchange for a percentage of your future sales. Repayments are typically taken daily or weekly as a share of your revenue. MCAs are easier to qualify for compared to loans, and in most cases, no SSN or credit score is needed. However, they often have very high effective interest rates, making them one of the most expensive financing options. They’re best considered as a last resort for short-term cash flow needs. Contact us if you need help or recommendations for MCA providers.
List of Countries
Macedonia, Serbia, Montenegro, Bahamas, Germany, Netherlands, Greece, Vietnam, Mexico, Sweden, Brazil, Colombia, Argentina, India, Australia, Bolivia, French Guyana, Slovenia, Italy, Belgium, Philippines, UAE, UK, Singapore, Turkey, Georgia, Spain, Ireland, Egypt, Bosnia, Portugal
