3 ms·

Ask HN: Non-US Person Incorporating in the US

I have two questions to non-us startup founders who incorporated in the US: 1. Can I as a non-US citizen own an LLC and "work" for the LLC as an owner outside the US (meaning invoicing to customers in EU from the LLC)? 2. How did you guys managed to work for your US startup as a non-US citizen, without a working visa? PS: Can anyone recommend a good lawyer?

otoburb 4y ago
While you can probably stand up an LLC or C-corporation easily enough, you'd need to be careful about federal withholding tax[1] and additional federal tax forms to file[2] every year since you're not a US resident. Depending on which state you incorporate in, there may also be additional state tax forms for foreign owners/members. I'm not sure what benefit there would be for you to create an entity in the US if you're not going to be here physically. Before you speak to a lawyer or accountant you should have a good reason why you want to go down this path. [1] https://www.irs.gov/individuals/international-taxpayers/nra-withholding https://www.irs.gov/individuals/international-taxpayers/nra-... [2] https://drummondadvisors.com/en/2020/11/20/foreign-owned-single-member-llc-and-irs-form-5472/ https://drummondadvisors.com/en/2020/11/20/foreign-owned-sin...
- Startup_hustle 4y ago
  >I'm not sure what benefit there would be for you to create an entity in the US if you're not going to be here physically. Privacy.
- devKnight 4y ago
  one benefit for people from abroad of creating their corp in the US, is that services are available. ie: you can use stripe or other payment processors in a lot of countries. It would be cheaper to setup a US corp, stripe, bank account etc. And then just send the profits home through swift. With all of the fees factored in, sometimes it can be more expensive to do payment processing locally, because of crap rates from local payment processors. That's just one example, I'm sure there are others
npc12345 4y ago
If this this is avoid taxes just open a bank account in panama.
olivierduval 4y ago
Just to be sure to understand, and to summarize - you don't live in US - you want to build a start-up in the nuclear research field - you don't want Europe to find out EASILY who own this nuclear research start-up (the privacy motivation) From my point of view, it seem like you know that you shouldn't build this startup, either because of regulation or non-compete agreement (like using research done for a current Europe corp or administration without rights), and I'm afraid that Europe will think the same (and US won't protect you on this I guess) I think that if your startup succeed, Intelligence Services will quickly find out who you are (well... nuclear research is I think closely monitored, dont you think).
slater 4y ago
Might come down to what kind of visa YOU have?
- Startup_hustle 4y ago
  I do not obtain one.
ushakov 4y ago
don’t do this unless you plan to move to the US or open an office in the US you need substance to open a business overseas unless you’re a multi-national company, you should incorporate your business where you reside
aaaaaaaaata 4y ago
> 1. Can I as a non-US citizen own an LLC and "work" for the LLC as an owner outside the US (meaning invoicing to customers in EU from the LLC)? I've seen this done by an agent (and/or employee) of the new LLC, but am not a lawyer and can't comment on how smart it is. What type of company, out of curiosity?
- Startup_hustle 4y ago
  Focusing mostly on nuclear research
  - Nextgrid 4y ago
    That might complicate things a lot more with regards to potential export restrictions, etc.
emurlin 4y ago
IANAL and not a startup founder who incorporated in the US, but answering as someone with some general knowledge on the subject and some experience incorporating on different jurisdictions (with the usual disclaimer that this no legal or tax advice). Generally, you can 'incorporate' in the US as a non-US person. I put that in quotes because LLCs are not technically corporations (US LLCs are 'unincorporated associations') so normally the term used is 'organized' or some such. You can also incorporate proper, having a C corporation in the US. As a non US person, what you cannot do is be a shareholder of an S corporation, which is a special type of corporation that is pass-through for tax purposes (in short, meaning that the shareholders pay tax directly instead of the corporation itself being taxes). If you want to go down this path, it's good you're looking for a good lawyer, as they can advise you on the best way going forward. That said, there are many online formation services that take care of the paperwork for you for some nominal fee (say between $200-$500), and some jurisdictions that are popular for non-residents are Delaware Nevada and Florida. As far as I know, for Delaware this is partly because of some perceived tax benefit, plus it being a place with a good reputation for doing business. For question number 2, if you'll be working from outside the US, I don't see how it can be an immediate problem, since immigration laws that restrict you from working usually would apply when you're in US soil. As far as I know, there's no restriction on working from abroad, so long as you otherwise follow the law. You could probably even be an employee of your LLC in your local jurisdiction. You don't say why you want to incorporate in the US and maybe you have good reasons for this. However, some of the negatives are that you'll likely complicate things for yourself, as now you'll have to report to the US authorities (taxes, etc.) in addition to to your local jurisdiction, you'll likely need US and XX accountants, etc. Plus, LLCs are sometimes problematic from outside the US, because they're not really corporations, which from what I hear can cause issues with things like opening local bank accounts, registering with local authorities, etc. Under transfer pricing rules, you're likely not going to get any tax benefits from operating a US entity, and you could if fact end up double- (or triple-)taxed, depending on where you are and where your clients are and the tax treaties between all those places. Since you say you're not in the US and mention EU-clients, maybe consider incorporating in some EU state instead?
- Startup_hustle 4y ago
  Thank you for your comment. >You could probably even be an employee of your LLC in your local jurisdiction. Just to clarify, do you mean I can work outside US jurisdiction, if I am a CEO of the LLC? I think this is my only question. In the case I can't, is it possible to not be an officer but work for the company as an Owner? >maybe consider incorporating in some EU state instead Incorporation to any EU member jurisdiction is a no-go for privacy reasons, so no amount of reporting or cost burden is an issue.

otoburb 4y ago

While you can probably stand up an LLC or C-corporation easily enough, you'd need to be careful about federal withholding tax[1] and additional federal tax forms to file[2] every year since you're not a US resident. Depending on which state you incorporate in, there may also be additional state tax forms for foreign owners/members. I'm not sure what benefit there would be for you to create an entity in the US if you're not going to be here physically. Before you speak to a lawyer or accountant you should have a good reason why you want to go down this path. [1] https://www.irs.gov/individuals/international-taxpayers/nra-withholding https://www.irs.gov/individuals/international-taxpayers/nra-... [2] https://drummondadvisors.com/en/2020/11/20/foreign-owned-single-member-llc-and-irs-form-5472/ https://drummondadvisors.com/en/2020/11/20/foreign-owned-sin...

Startup_hustle 4y ago
>I'm not sure what benefit there would be for you to create an entity in the US if you're not going to be here physically. Privacy.
devKnight 4y ago
one benefit for people from abroad of creating their corp in the US, is that services are available. ie: you can use stripe or other payment processors in a lot of countries. It would be cheaper to setup a US corp, stripe, bank account etc. And then just send the profits home through swift. With all of the fees factored in, sometimes it can be more expensive to do payment processing locally, because of crap rates from local payment processors. That's just one example, I'm sure there are others

npc12345 4y ago

If this this is avoid taxes just open a bank account in panama.

olivierduval 4y ago

Just to be sure to understand, and to summarize - you don't live in US - you want to build a start-up in the nuclear research field - you don't want Europe to find out EASILY who own this nuclear research start-up (the privacy motivation) From my point of view, it seem like you know that you shouldn't build this startup, either because of regulation or non-compete agreement (like using research done for a current Europe corp or administration without rights), and I'm afraid that Europe will think the same (and US won't protect you on this I guess) I think that if your startup succeed, Intelligence Services will quickly find out who you are (well... nuclear research is I think closely monitored, dont you think).

slater 4y ago

Might come down to what kind of visa YOU have?

Startup_hustle 4y ago
I do not obtain one.

ushakov 4y ago

don’t do this unless you plan to move to the US or open an office in the US you need substance to open a business overseas unless you’re a multi-national company, you should incorporate your business where you reside

aaaaaaaaata 4y ago

> 1. Can I as a non-US citizen own an LLC and "work" for the LLC as an owner outside the US (meaning invoicing to customers in EU from the LLC)? I've seen this done by an agent (and/or employee) of the new LLC, but am not a lawyer and can't comment on how smart it is. What type of company, out of curiosity?

Startup_hustle 4y ago
Focusing mostly on nuclear research
- Nextgrid 4y ago
  That might complicate things a lot more with regards to potential export restrictions, etc.

emurlin 4y ago

IANAL and not a startup founder who incorporated in the US, but answering as someone with some general knowledge on the subject and some experience incorporating on different jurisdictions (with the usual disclaimer that this no legal or tax advice). Generally, you can 'incorporate' in the US as a non-US person. I put that in quotes because LLCs are not technically corporations (US LLCs are 'unincorporated associations') so normally the term used is 'organized' or some such. You can also incorporate proper, having a C corporation in the US. As a non US person, what you cannot do is be a shareholder of an S corporation, which is a special type of corporation that is pass-through for tax purposes (in short, meaning that the shareholders pay tax directly instead of the corporation itself being taxes). If you want to go down this path, it's good you're looking for a good lawyer, as they can advise you on the best way going forward. That said, there are many online formation services that take care of the paperwork for you for some nominal fee (say between $200-$500), and some jurisdictions that are popular for non-residents are Delaware Nevada and Florida. As far as I know, for Delaware this is partly because of some perceived tax benefit, plus it being a place with a good reputation for doing business. For question number 2, if you'll be working from outside the US, I don't see how it can be an immediate problem, since immigration laws that restrict you from working usually would apply when you're in US soil. As far as I know, there's no restriction on working from abroad, so long as you otherwise follow the law. You could probably even be an employee of your LLC in your local jurisdiction. You don't say why you want to incorporate in the US and maybe you have good reasons for this. However, some of the negatives are that you'll likely complicate things for yourself, as now you'll have to report to the US authorities (taxes, etc.) in addition to to your local jurisdiction, you'll likely need US and XX accountants, etc. Plus, LLCs are sometimes problematic from outside the US, because they're not really corporations, which from what I hear can cause issues with things like opening local bank accounts, registering with local authorities, etc. Under transfer pricing rules, you're likely not going to get any tax benefits from operating a US entity, and you could if fact end up double- (or triple-)taxed, depending on where you are and where your clients are and the tax treaties between all those places. Since you say you're not in the US and mention EU-clients, maybe consider incorporating in some EU state instead?

Startup_hustle 4y ago
Thank you for your comment. >You could probably even be an employee of your LLC in your local jurisdiction. Just to clarify, do you mean I can work outside US jurisdiction, if I am a CEO of the LLC? I think this is my only question. In the case I can't, is it possible to not be an officer but work for the company as an Owner? >maybe consider incorporating in some EU state instead Incorporation to any EU member jurisdiction is a no-go for privacy reasons, so no amount of reporting or cost burden is an issue.