US LLC taxes for foreign owners
A US LLC owned by one foreign person is usually ignored for income tax, but it must still file Form 5472 with a pro forma Form 1120 each year. It's due April 15, and the penalty for missing it is $25,000. If the LLC has US business income, the owner also files Form 1040-NR.
Updated November 2026 · By Pankil Kumar, Managing Partner
Quick facts
- Yearly filing. Form 5472 with a pro forma 1120
- Due. April 15 for calendar-year LLCs
- Penalty. $25,000 for failure to file
How is a foreign-owned LLC taxed?
A single-member LLC is disregarded for US income tax by default. So the LLC itself doesn't pay tax. If its income is effectively connected with a US trade or business, you, the owner, report it on Form 1040-NR. If it's not, because you run everything from abroad and have no US office or staff, there may be no US income tax at all.
That depends on your facts, so don't assume it. US staff, inventory or an agent can change the answer. Your home country may tax the income too.
Why file Form 5472 if you owe no tax?
Treasury rules treat these LLCs as corporations for one purpose, which is reporting transactions with their foreign owner. That means you file Form 5472 with a pro forma Form 1120 every year, listing money in and out between you and the LLC. Your initial capital counts. So does paying yourself.
Missing it costs $25,000, even if your LLC made nothing. The form goes to a specific IRS address or fax, not with regular e-filing. Our Form 5472 guide covers the details.
What about multi-member LLCs?
Two or more owners means a partnership, which files Form 1065, with extra rules and withholding for foreign partners. It's a very different job. Check this before you add a co-founder abroad.
What else do you need?
| Item | Why |
|---|---|
| EIN | Needed for filings and banking, using Form SS-4 |
| US bank account | Keep records clean |
| Registered agent and annual report | State rules |
| ITIN | Needed if you file a Form 1040-NR |
| Bookkeeping | Form 5472 needs exact figures |
A BOI report isn't needed for a US-formed LLC, even with foreign owners.
What are the common mistakes?
- Thinking no income means no filing
- Not recording owner contributions and draws
- Selling to US customers with no thought to sales tax
- Assuming a Delaware or Wyoming LLC means no tax anywhere
If you've missed past years, don't wait for a notice. File as soon as you can. Our Form 5472 service prepares it every year.
Sources
General information, not tax advice for your situation.
Filing from outside the US?
ITINs, expat returns, non-resident returns and Form 5472.
See our ITIN and cross-border serviceDoes a foreign-owned LLC have to file a US tax return?
A single-member one usually files Form 5472 and a pro forma 1120, even with no income.
What is the penalty for not filing Form 5472?
$25,000 for each failure, and more if it continues after an IRS notice.
Can a non-resident own a US LLC?
Yes. There's no citizenship or residency requirement, though a US address and registered agent are needed.
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