What is an LLC and how does it work?

How a U.S. LLC works for non-residents

A Limited Liability Company (LLC) is a US business structure that combines limited liability protection with pass-through taxation. For non-resident single-member owners, a US LLC is typically classified as a Disregarded Entity and pays no federal income tax in the United States on foreign-source income.

Advantages of a US LLC for non-residents

  • No federal income tax for foreign-owned Single-Member LLC on foreign-source income
  • Limited liability: your personal assets are separated from the business
  • US dollar business banking when the activity, country, documents and compliance profile support the application
  • International invoicing when contracts, activity, documentation and payment flows support the operation
  • Payment and treasury options when the provider, country, risk profile and documentation support the case
  • Public-register privacy depending on the state (Wyoming offers one of the strongest frameworks)
  • Credibility of an incorporated US entity
  • No US residency or visa required

Best US states to form your LLC in 2026

New Mexico: efficient structure for digital entrepreneurs

No Annual Report, no state income tax, simple ongoing compliance. Ideal for founders who prioritize operational simplicity and low recurring costs.

Wyoming: maximum privacy for your LLC

No state tax, strong public-register privacy (members are not public record), asset protection statutes and modern business law. The right choice when privacy and legal separation matter.

Delaware: best legal framework and Court of Chancery

Specialized Court of Chancery for business disputes, the preferred jurisdiction for startups seeking investors. Recommended if you plan to raise capital from US investors.

How to form your US LLC step by step

  1. Strategic tax diagnosis: analysis of your situation, income and residency
  2. State selection: personalized recommendation among New Mexico, Wyoming, Delaware and Florida
  3. LLC formation: filing the Articles of Organization with the state
  4. EIN application: obtaining the IRS tax ID for your LLC
  5. Operating Agreement: drafting your LLC's internal governance contract
  6. Business banking file: documentation, activity narrative and provider fit before any application
  7. Payment readiness: website, invoices, refund policy, KYC/KYB and risk profile aligned before onboarding

Annual tax obligations of a US LLC for foreign owners

  • Form 5472: annual information return on transactions with related parties
  • Form 1120: corporate return filed as a pro forma cover for Form 5472
  • BOI Report: Beneficial Ownership Information filed with FinCEN only when the entity is in scope
  • Annual Report: only required in Wyoming and Delaware (New Mexico does not require one)
  • Registered Agent renewal: annual, in the state of formation

See services and pricing or book a strategic tax consultation.