Real Tax Questions, Expert Answers
Get answers to your foreign-owned LLC tax questions from ForeignLLCTax. Every answer includes IRS source citations and step-by-step guidance.
How long do I have to keep my foreign-owned LLC's records — is there a fixed number of years?
I want to clean up old files but I'm afraid of throwing out something the IRS will want. Is there a set retention period for section 6038A records, like seven years? My situation is messy because some...
What is the 1031(f) related-party 2-year rule, and does it catch an exchange done through my intermediary?
I want to exchange into a replacement property owned by a company my brother controls — so a related party. Someone warned me about a '2-year rule' under 1031(f) that can blow up the deferral. How doe...
Can I use the installment method when I sell my interest in a US partnership/LLC?
I'm a foreign partner selling my interest in a US LLC taxed as a partnership, with the price paid over three years. Can I report on the installment method, and is there any withholding on the sale lik...
Can I use First-Time Abatement and reasonable cause together on the same late LLC filing?
My foreign-owned LLC filed its pro forma Form 1120 plus Form 5472 late for one year, and the IRS hit me with penalties. I have a clean history. Can I claim First-Time Abatement AND reasonable cause fo...
If I don't resolve my CP2000, when does the 90-day Tax Court deadline start?
I'm going back and forth with the IRS on a CP2000 and worried about deadlines. People keep mentioning a 90-day Tax Court window. Does that 90 days start from the CP2000 date? And does living abroad ch...
Can I just file a W-8ECI to skip the 30% withholding on my creator income?
Someone in a forum said that if I file Form W-8ECI instead of W-8BEN-E, platforms won't withhold the 30% at source. That sounds like an easy win. Can I treat W-8ECI as a switch to stop withholding on ...
Amazon and Etsy collect sales tax for me — why isn't Shopify doing the same for my store?
On Amazon and Etsy the platform charges and remits the sales tax automatically, so I assumed my Shopify store would too. But it looks like I'm responsible for sales tax on my own Shopify storefront. W...
A foreign company owned by my family sent me $25,000 as a gift — does the $100,000 threshold apply?
I'm now a US resident, and my family still runs our business abroad. This year the company itself — not my parents personally — transferred me $25,000, described in the paperwork as a gift for my relo...
My LLC earns staking rewards — when is that income, and does the US even get to tax it?
The LLC stakes ETH and a couple of proof-of-stake tokens, partly directly from our own wallet and partly through an exchange staking program. I understand there is now an IRS ruling on staking, but my...
FUTA with one employee: when does my LLC actually have to deposit anything?
Mexican founder, US LLC, one full-time employee in the States since March. I keep seeing federal unemployment tax described as 6 percent in one place and 0.6 percent in another, and my provider says w...
My LLC sale includes an earnout based on future revenue — is that still capital gain from abroad?
I'm selling my US LLC (it owns a software product and the brand). The deal is a fixed payment at closing plus an earnout: a percentage of the product's revenue for the next three years. I assumed the ...
I picked an AFR rate for my owner loan — but could the IRS still say it's really equity, and does section 163(j) limit my interest deduction?
I set my owner-loan interest inside the AFR safe-haven, so I assumed the interest question was settled. Then I read that even with a good rate the IRS can recharacterize the 'loan' as equity, and that...
I fund my factory's tooling and packaging — does that increase my customs value (assists)?
I buy private-label goods from my own foreign factory. I also pay for the molds, the custom packaging design, and some artwork the factory uses to make my product. On the customs entry we only declare...
Should I file a protective Form 1120-F if a treaty means $0 US tax?
My foreign corporation has very limited US activity, and I'm fairly confident a treaty means we owe $0 US tax (no permanent establishment). Filing a full 1120-F sounds like a lot of work for a zero re...
After Bittner, is the non-willful FBAR penalty per account or per year?
I had several foreign accounts and missed a few years of FBARs. I've read scary things about $10,000 per account adding up fast. Did the Bittner Supreme Court case change that for non-willful cases, a...
I don't have a US tax number yet and I'm selling — does FIRPTA filing just stop?
Foreign seller here, closing soon, and I've never had a US tax ID. The title company says they still have to send the FIRPTA money to the IRS, but without my number I'm worried the paperwork can't be ...
How does FBA compare with dropshipping and merchant-fulfilled for US tax risk?
I'm choosing a fulfillment model for my foreign-owned US LLC and I want to understand the tax-risk trade-offs before I commit. How do Amazon FBA, dropshipping from abroad, and merchant-fulfilled selli...
After I withhold, when do I actually have to deposit the tax, and when are Form 1042 and 1042-S due?
Say my LLC withholds tax on a payment to a foreign payee. What is the timeline after that? Do I send the money to the IRS immediately, monthly, or just once a year with the return? And when are Form 1...
What Social Security and Medicare amounts do I withhold and match for 2026 wages?
I'm an Indian founder and my US LLC just hired an engineer at 95,000 dollars a year, with a chance her total comp crosses 200,000 with bonuses. The payroll provider obviously does the math, but I sign...
Real-estate-heavy partnership LLC: buyer's counsel says FIRPTA and 1446(f) both apply — do we stack 15% plus 10%?
I'm a foreign member selling my interest in a US LLC taxed as a partnership. Most of its value is a commercial building. The buyer's lawyer flagged that a FIRPTA rule for partnership interests AND the...
Where are my LLC's crypto gains sourced — and what is the US office trap I keep hearing about?
Following up on the trade-or-business debate: assume the safe-harbor question for spot crypto never gets resolved. As a nonresident owner of a disregarded US LLC, are my crypto gains US-source or fore...
My mother sent $75,000 and my aunt $40,000 in the same year — each under $100,000, so no Form 3520, right?
I became a US resident last year. This year my mother (not a US person) wired me $75,000 and her sister added another $40,000, both to help me settle in and fund my company. Neither transfer crosses t...
Foreign-corp blocker vs single-member LLC for doing exchanges — which structure is better?
I'm deciding how to hold US rental real estate that I plan to exchange over time. Some people use a foreign corporation 'blocker', others just a single-member US LLC. How do the two compare for doing ...
I'm Canadian (or UK / French / German) — does a treaty lower the US estate tax on my US assets?
I'm a Canadian citizen with a US brokerage account and some US shares. I've heard there are estate-tax treaties that give nonresidents a bigger credit than the default $13,000. Does the Canada treaty ...
I couldn't use all my foreign tax credit this year — can I carry it forward?
My foreign tax was higher than the Form 1116 limitation allowed, so part of my credit went unused. Is that lost, or can I carry it to another year? And how long do I have to use it?
I have one isolated short project in a state — does a single job force me to register?
My out-of-state LLC landed one short consulting project that requires me to do a bit of work in another state for a few weeks, then I'm done there with no plans to return. It's a true one-off, not a r...
My LLC's books are in euros — how do I reconcile that with a US-dollar Form 5472, and what are sections 985-988 about?
My single-member LLC bills clients in euros and my accounting software is denominated in euros. Form 5472 obviously wants US dollars. Can I even keep my books in a foreign currency? How do I bridge to...
My LLC is disregarded — does the W-8BEN-E go in the LLC's name or mine as the foreign owner?
I have a US single-member LLC that's disregarded for tax, and I'm the foreign owner. A platform wants a W-8BEN-E. Do I put the LLC as the beneficial owner because the LLC has the EIN and gets paid, or...
I elected corporate status two years ago and regret it — can I change my LLC's classification back?
About two years ago my US LLC filed Form 8832 to be taxed as a corporation. It hasn't worked out and I want to go back to pass-through. Can I just file a new Form 8832, or is there a waiting period? W...
I'm selling shares of a US company, not real estate — can FIRPTA still hit me?
I'm a foreign investor selling my stock in a US C-corporation. No deed, no closing on a building — just a stock transfer. The buyer's counsel raised FIRPTA and wants some kind of certification from th...
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