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Starting a Business in the U.S. as a Foreign National

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Starting a Business in the U.S. as a Foreign National

By NicoleD
Published: June 8, 2009 Updated: February 28, 2014

Breaking into the U.S. market can be a rewarding venture for many foreign businesses. Because U.S. citizenship and residency are not required, foreign nationals are able to start or expand on U.S. soil without experiencing much more red-tape than an American-born business owner would.

Steps to Starting Up a Foreign Business in the U.S.:

  • Foreign business entities are incorporated at the state level in the U.S. The process will vary from state-to-state, but generally involves two steps: applying to register in that particular state, and establishing a registered agent with a valid address in that state (no PO Box numbers). A registered agent can be either the business owner or another person who is authorized to receive legal papers on behalf of the business, such as an attorney or secretary.
  • The rest of the steps to starting up are similar to those that an American citizen would take. The breakdown of 10 Steps to Starting a Business includes information on naming your business, requirement licenses and permits, and tax matters.
  • Establishing an online retail presence in the U.S. is a popular choice for many foreign business owners. You can read more about general resources for online businesses, including privacy and advertising regulations here, along with specific information on international sales.

Importing Goods into the U.S.:

  • The Department of Commerce's Trade Information Center provides information and web links to importation procedures.
  • Working with a licensed customs broker could be a valuable asset to your import plan. A customs broker prepares all the documentation required for importing goods. To learn about laws and regulations applying to custom brokers, including licensing requirements and importing procedures, visit the Transportation and Logistics Guide.
  • Many imported and exported products are regulated by federal agencies and may require specific licenses and permits. Check here to see if you need to obtain additional paperwork.

U.S. Tax information for Foreign Businesses:

  • The U.S. tax code can be confusing even to life-long citizens. Violation of any tax—sales, payroll, income, etc.—can incur fees and penalties. The IRS offers a guide specifically on International Business, but if you are still left with more questions, it is always safe to check with a qualified attorney or accountant.
  • U.S. citizens will likely need an Employment Identification Number to start up, a process that requires their social security number (SSN). In the case of foreign businesses, an Individual Taxpayer Identification Number (ITIN) will suffice. The IRS issues these 9-digit tax processing numbers to individuals who are required to pay US taxes but who are ineligible for a SSN, including resident and non-resident aliens and foreign nationals.
  • You may be required to file IRS Form 5472, which applies to US corporations with at least one foreign owner who owns 25% of shares, to account for the nature of monetary transactions.
  • There are also special tax credits and incentives available to businesses, including foreign tax treaties. The IRS offers a tax treaty overview and resources here.

Edited for formatting issues.

About the Author:

Comments:

I am a non US resident have the intention to set up a online business in US. How can I go about doing this without being present in US?
Hi everybody, Thank you for the opportunity to ask some questions. I am non US citizen legal resident with employment permission. My intention is to create my small business importing organic products from Greece and selling them to shops or on line here in the USA. Can you provide some steps to me so that I can import initially organic olive oil, are there any restrictions importing it etc. Also I am interested in having some guidelines how to create this small business as a sole proprietor at this stage.Thank you for your hospitality. Waiting for your reply. Spyros
Hi, I am a US non citizen legal resident with employment authorization. I wish to know whether I can establish a company to do export from USA or not, and what would the possible conditions be if the answer is yes. Thank you.
Hi I am running a web design and development business in Australia for more than 8 years. I want to expand in US, hence was planning to come to US after registering the business in US for appo. 3 months. What are my chances? Thank you in advance.
Consider L-1 visa petition. However, it's tricky and you would be better off consulting an immigration attorney.
Hi, I am Canadian citizen since 1984 living in Montreal Canada and I am in IT business since 30years. Right now I'm thinking to create my own compagny (IT Permanent and consultants placements in US) in Miami WPB where I will live for good. I have the budget for living there,renting an office, hiring 2-3 US citizens as Account mangers and recruiters with annual salary guarantee for all three. What are the steps?
Hello, may I ask , can B1/B2 holder start his won bussines in US in case of presence of permanent mail address of person hold green card? Wish to recive the answer ASAP Thank you
Question: I lived in the US for several years and started an LLC there. I maintain a residence there but live mostly in Canada now. I have an SS# and EIN # and pay US taxes. Are US LLCs owned by nonresidents eligible for SBA loans?
Hello, I'm a Canadian looking to start a business in the US. My understanding is that I need to start an LLC in the state to start the business, with an address of someone who has signing authority. I have someone who lives in the US but cannot be involved in the business due to their current work situation. Is there any way to get someone who isn't a lawyer to be the mailing address? Do I start the LLC as a Canadian in Canada? I'm a bit confused with the chicken and egg situation here... Then once I have the LLC it is possible to get the EIN to file taxes in the US? Once that is done, is there any way to make my head office in the US and get a permanent work visa via the LLC that I created? Thanks for any help.
I am discussing a business opportunity with a Brazilian national who wishes to relocate to the USA. Would appreciate any info on how this person could invest ina LLC or Corporation and receive a work permit here. thank you.

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