Form a US Company — LLC in Days, Not Months

LLC vs C-Corp vs S-Corp vs Sole Proprietorship

Four structures exist on paper; for a non-resident only two are realistic. Pick the wrong one and you either overpay tax or block yourself from raising money.

• LLC (Limited Liability Company) — the default for e-commerce sellers, SaaS, agencies and consultants abroad. No minimum capital, limited liability, and pass-through taxation: the LLC itself pays no federal income tax, profits flow to the members. A foreign-owned single-member LLC with no US-source effectively connected income can be extremely tax-efficient (annual IRS reporting still applies).
• C-Corporation — the venture-capital standard, almost always in Delaware. Any nationality can own it. The price is double taxation: 21% federal corporate income tax at the entity level, then dividend tax at the shareholder level. You accept that cost because every US VC term sheet expects a Delaware C-Corp with SAFEs, option pools and preferred stock.
• S-Corporation — a tax election, not a separate entity, and closed to you: every shareholder must be a US citizen or resident. A non-resident alien can never be an S-Corp shareholder. If anyone offers to set one up for you as a foreigner, walk away.
• Sole Proprietorship / DBA — no entity, no liability shield, personal assets fully exposed, and impractical for non-residents (there is no company to open a bank or marketplace account against). For a few hundred dollars an LLC gives the shield and the paperwork platforms expect.

Rule of thumb: selling products or services → LLC. Raising money from US investors → Delaware C-Corp. Many founders start as an LLC and convert to a Delaware C-Corp at their first priced round.

Choosing the State: Delaware vs Wyoming vs Florida

Incorporation is a state matter, and the three states non-residents actually use pull in different directions — legal prestige, low cost, or real US operations.

Delaware is the answer when investors are in the picture: over two-thirds of the Fortune 500 are incorporated there, and two centuries of Court of Chancery case law make shareholder rights predictable. Wyoming is the cheapest, most private home for a plain e-commerce or SaaS LLC with no US footprint. Florida makes sense when you actually operate on the ground — a warehouse, staff, or a physical storefront.

Step-by-Step: Formation, EIN and Bank Account

1. State & name selection. Pick the state for your model and check name availability in the state registry; reserve it if useful.
2. Formation filing. File the Certificate of Formation (Delaware) or Articles of Organization (Wyoming, Florida) with the Secretary of State. Wyoming approves in 1-3 business days; Delaware standard processing runs about 1-2 weeks (expedite available).
3. Registered agent. Every state requires an in-state registered agent to receive official mail — a legal must-have for a non-resident, typically bundled into the formation package.
4. Operating agreement. The internal contract defining ownership, profit split and management. It is not filed with the state, but banks, Stripe and marketplaces routinely ask for it. C-Corps get bylaws, board resolutions and a stock ledger instead.
5. EIN from the IRS. File Form SS-4. Without an SSN or ITIN you cannot use the online tool, so the SS-4 goes by fax or mail (or the IRS international phone line) with a foreign address and "foreign" on line 7b — no ITIN needed. Processing is typically 2-4 weeks, so file it on day one.
6. US business bank account. With formation documents and the EIN letter (CP 575), apply to fintech business banks that onboard non-residents fully remotely.

Registered Agent and Operating Agreement — Why They Matter

Two documents trip up first-time founders because neither is optional and neither is what it looks like.

The registered agent is your company's legal address inside the state: the entity that accepts lawsuits, tax notices and Secretary of State correspondence. You cannot use a foreign address for this, which is exactly why the agent is mandatory and included in every serious formation package. Renewal is annual.

The operating agreement is never filed publicly, so people skip it — a mistake. It is the contract that proves who owns the LLC and in what proportion, how profits are split, and who can sign. Mercury, Relay, Stripe and Amazon all ask to see it during onboarding. A single-member LLC needs one just as much as a multi-member LLC.

Opening a US Bank Account Remotely

A non-resident does not need to fly to the US. Fintech business banks onboard foreign-owned US companies fully online using your formation documents, EIN letter and passport.

• Mercury — the standard for startups and e-commerce sellers; USD checking, ACH, domestic and international wires, virtual cards.
• Relay — multiple accounts and sub-accounts, popular with sellers who separate tax, inventory and payroll buffers.
• Traditional banks (Chase, Bank of America) — generally require an in-person branch visit and often a US address; not a realistic remote option.

Fintechs keep restricted-country lists and run their own KYC, so approval is not automatic — the application should be prepared carefully. Once the account is live, Stripe, PayPal and Amazon disbursements settle natively on top.

The Federal Tax Stack: 21% Corporate Tax and Double Taxation

Which tax you pay depends entirely on the entity you chose.

An LLC is a pass-through: no corporate-level federal income tax. A foreign-owned LLC with no US-source effectively connected income (ECI) may owe no US federal income tax at all — though the annual information filings below are still mandatory. Where ECI exists, the members file a 1040-NR on their share.

A C-Corp pays 21% federal corporate income tax on its profits at the entity level. When it then distributes dividends, the shareholder is taxed again — the classic double taxation. That is the accepted cost of the structure VCs demand; it is not a flaw, it is the trade-off for standard preferred-stock fundraising.

State Taxes and the Sales Tax Nexus Trap

Beyond federal tax sit state-level obligations that catch newcomers off guard — especially sales tax, which is a state (and often local) tax, never federal.

You do not register for sales tax on day one. An obligation arises per state only once you have nexus. Since South Dakota v. Wayfair (2018), states set economic-nexus thresholds — commonly $100,000 in annual sales or 200 transactions into that state (thresholds vary). Below the threshold, you neither register nor collect there.

Marketplace facilitator laws are the good news: Amazon, Walmart and Etsy collect and remit sales tax on marketplace orders in essentially every state, so those channels are largely handled for you. Your own Shopify or website sales are your responsibility — monitor thresholds and register state by state as you cross them. Separately, some states levy corporate income or franchise tax (Florida's 5.5% corporate rate; Delaware's flat $300 LLC franchise tax).

Twelve-Month Cost of a US LLC

A realistic first-year budget in US dollars for a non-resident-owned LLC. Numbers vary by state and provider; these are typical ranges.

A lean Wyoming e-commerce LLC can run well under $1,000 in its first year; add a US CPA for the 5472 filing and budget closer to $1,500-$2,000.

Annual Obligations: Report, Franchise Tax and Form 5472

A US company is not fire-and-forget. Three recurring layers keep it in good standing.

• State report / franchise tax. Delaware LLCs pay a flat $300 franchise tax by June 1 (no report required); Wyoming files an annual report with a license tax from about $60; Florida files a $138.75 annual report.
• Registered agent renewal. Annual, and usually bundled into your package.
• Form 5472 + pro forma 1120. A foreign-owned single-member LLC must file Form 5472 attached to a pro forma Form 1120 every year. The penalty for missing it is $25,000 — this is the single most important compliance item and is not optional.

If the LLC has US-source effectively connected income, an income tax return (e.g. 1040-NR for members, or 1120 for a C-Corp) is also due. A compliance calendar is essential.

A Company Is Not a Visa: The Immigration Distinction

This is the most common misunderstanding, so it deserves its own section. Owning a US company grants no right to live or work in the United States. You can form, own and run an LLC or C-Corp entirely from abroad, banking and all, without ever entering the country.

If you later want to relocate, the company can support an immigration application — the E-2 treaty investor visa or the L-1 intracompany transfer, for example — but those are separate processes with their own requirements, handled by an immigration attorney. Forming the company first is often a prerequisite; it is never the visa itself.

The E-Commerce Seller Scenario: Amazon, Walmart, Stripe, PayPal

For most non-resident founders the whole point of a US entity is selling online, and here the structure pays for itself immediately.

A US LLC or C-Corp is the native key to Amazon.com, Walmart Marketplace, Etsy, TikTok Shop and Target Plus: a US marketplace account, a US tax interview using a W-9 instead of a W-8, and the buyer trust of a domestic seller profile. Stripe and PayPal Business onboard cleanly against the EIN and US bank account, so your website and checkout run on the same rails as any American merchant.

On sales tax, the marketplace facilitator laws mean Amazon and Walmart already collect and remit for you in nearly every state — you mainly watch nexus on your own direct (Shopify/website) sales. The combination of a US LLC, a Mercury account, Stripe and marketplace facilitator coverage is why a founder in Istanbul or São Paulo can run a fully compliant American storefront.

2026 Outlook

Three trends shape the year ahead for non-resident founders.

• Beneficial-ownership reporting. The Corporate Transparency Act's BOI regime has narrowed after 2025 rulemaking — check current FinCEN guidance for whether your foreign-owned entity must file, as the scope has shifted.
• Fintech KYC tightening. Mercury and Relay continue to refine their restricted-country and risk screening; a clean, well-documented application matters more than ever, and pre-screening the profile before applying is worth it.
• Sales tax enforcement. States keep lowering and auditing economic-nexus thresholds; direct-to-consumer sellers should track their own-channel volumes state by state rather than assuming marketplace coverage protects everything.

The core proposition is unchanged: the US remains the lowest-friction major jurisdiction for a non-resident to own a company — no minimum capital, no notary, no visit — and for an e-commerce founder it is still the single largest market in the world.