TaxForm 5472: the USD 25,000 filing foreign-owned LLCs forget
A single-member LLC owned by a non-U.S. person is disregarded for income tax, but is treated as a corporation for reporting. It must file a pro-forma Form 1120 with Form 5472 attached, disclosing reportable transactions with its foreign owner — including capital contributions and distributions. The penalty for non-filing begins at USD 25,000 per entity per year and applies to dormant entities.
Compliance desk · ICS Corporate Services (US)
StructuringDelaware or Wyoming? Usually the wrong question
State of formation governs internal corporate law, the annual report and franchise tax. It does not decide where you pay income tax. Employees, an office, inventory or sales volume create nexus in a state, obliging you to qualify and file there whatever the certificate says. Choose the state of formation last, after mapping where the business will physically operate.
Compliance desk · ICS Corporate Services (US)
ReportingWhere FinCEN beneficial ownership reporting now stands
FinCEN’s March 2025 interim final rule narrowed the definition of a reporting company to entities formed outside the United States that register to do business in a U.S. state. Domestic entities are exempt, and U.S. person beneficial owners need not be reported. Groups with offshore parents registering U.S. branches should still assess each entity individually.
Compliance desk · ICS Corporate Services (US)
Sales taxEconomic nexus: selling into a state you have never visited
Since South Dakota v. Wayfair, states may require registration and sales tax collection based on sales into the state alone, with no physical presence. Thresholds vary. Marketplace facilitator rules can shift the obligation to Amazon or a similar platform for marketplace sales — but not for sales through your own website, which are frequently overlooked.
Compliance desk · ICS Corporate Services (US)
TreatyDoes your holding company actually qualify for treaty relief?
Withholding on U.S.-source dividends, interest and royalties can often be reduced by treaty — but only where the recipient is resident in a treaty jurisdiction and satisfies the limitation-on-benefits article. Several jurisdictions commonly used for holding companies, including the BVI, Cayman and Hong Kong, have no income tax treaty with the United States. This is a structuring decision, not a filing one.
Compliance desk · ICS Corporate Services (US)
GovernanceThe corporate record book nobody kept
Banks, investors and buyers ask for the minute book, the register of members and the signed resolutions. Entities administered informally for years often cannot produce them, and reconstructing a record book under transaction deadlines is expensive and sometimes not possible. Maintaining it costs very little; the alternative surfaces at the worst moment.
Compliance desk · ICS Corporate Services (US)
These notes are general and current at the time of writing. U.S. federal and state requirements change frequently. Ask us for the position on your own facts before acting.