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.
I don't have an SSN — how do I get the ITIN I need for Form 8288-B?
I'm filing Form 8288-B to reduce FIRPTA withholding on my exchange, but the form wants a US taxpayer ID for every party and I'm a nonresident with no SSN. How do I actually get a number in time? Can I...
Are import duties deductible right away, or do they go into inventory under section 263A?
I paid a lot of customs duties this year on inventory that's still mostly sitting in the Amazon warehouse unsold. Can I deduct all those duties now as an expense, or do they have to be capitalized int...
A foreign country withheld more than the treaty rate — can I credit the full amount?
A foreign payer withheld 25% on a royalty paid to me, but the tax treaty rate should have been 10%. I never claimed the treaty rate or asked for a refund. Can I just take a foreign tax credit for the ...
Does holding US property through an LLC protect me from estate tax?
I keep reading that a US LLC gives liability protection. If I move my US real estate into a single-member LLC, or into a multi-member LLC with a partner, does that take it out of the US estate-tax net...
Best state for a foreign-owned bootstrapped SaaS — Wyoming or Delaware?
I'm a non-resident planning to launch a B2B SaaS product. I'm bootstrapping — no investor plans, just product revenue. Should I form in Delaware to look professional to US customers, or in Wyoming for...
What is the section 6038A(e) 'authorization of agent' requirement and why is the 30-day deadline a trap?
Someone warned me that as a foreign owner of a US LLC, I might have to sign something making my LLC my 'agent' if the IRS examines us, and that there's a tight 30-day deadline. I don't fully understan...
Florida LLC annual report — what does the $400 late fee actually cost me if I miss May 1?
I formed a Florida LLC last year and my registered agent reminded me the annual report is due by May 1. I almost certainly cannot get it filed in time — I am abroad and the documents I need are still ...
How do I stop FIRPTA from trapping cash I don't actually owe in tax?
My real gain on this US sale is small because my basis is high, but at 15% of the sale price the buyer would hold back a huge amount and I'd wait ages for a refund. Is there a way to reduce what's wit...
My US LLC (taxed as a corporation) pays royalties and interest to its foreign parent — do I withhold and file 1042-S?
We have a US LLC that elected to be taxed as a corporation. It pays a royalty for IP and some interest on an intercompany loan up to its foreign parent company. Because it's all inside the same group,...
Texas franchise tax — my foreign-owned LLC has $0 Texas activity. Am I still on the hook?
I formed a Texas LLC because I had a contractor based in Austin two years ago. He's gone. The LLC now has zero Texas customers, no Texas employees, no Texas property — but I'm still getting Texas fran...
If Amazon already remits the sales tax, do I still have to register in those states?
Since Amazon collects and remits sales tax on all my marketplace orders, do I, as a foreign-owned LLC selling only on Amazon FBA, still have to register for a sales tax permit in the states where my i...
What is the difference between 24% and 30% withholding on my creator income, and which one applies to me?
I've seen both 24% and 30% quoted as the rate a platform might withhold from a foreign creator. They are clearly not the same thing. What's the difference between them, when does each one apply, and h...
Why does a fake ITIN compromise all my Form 5472 filings, not just one year?
I'm trying to understand the scope of exposure if I've used a fabricated ITIN on multiple years of Form 5472. Does only the most recent filing have a problem, or all of them? And does this affect my u...
Colorado periodic report — Noncompliant vs Delinquent status and how to cure each
My Colorado LLC missed its periodic report. The SOS site shows the status changed from 'Good Standing' to 'Noncompliant' first, and now my registered agent says it's about to become 'Delinquent.' What...
Montana LLC annual report — $20 by April 15 or $35 after the deadline?
I formed a Montana LLC last year because the formation costs looked friendly. My registered agent says I need to file an annual report. I keep seeing two different numbers — $20 and $35. Which is righ...
Which US states tax services by default? Hawaii, New Mexico, South Dakota, West Virginia
Most US states only tax services if specifically listed. But I read that a few states tax services by default. Which states are these and what does it mean for my consulting business as a foreign-owne...
California digital software sales tax 2027 — is this current law I need to follow?
I saw news in May 2026 about California expanding sales tax to digital software and SaaS in 2027. My CFO is asking if we need to register California sales tax now. Is this a real change in current law...
Washington ESSB 5814 — what's now subject to sales tax after October 1, 2025?
I'm a foreign-owned LLC selling digital advertising services to Washington customers. Someone said Washington expanded sales tax to cover advertising and IT services in October 2025. What's the full l...
Maryland's July 1, 2025 IT services tax — what changed for my SaaS company?
I run a SaaS business selling to Maryland customers. I read that Maryland started taxing IT services at 3% on July 1, 2025, but my SaaS is still at 6%. Two rates seems strange. What's the rule and how...
What goes in the tax-ID field on Form 5472 if my related party has no ITIN and no foreign tax number?
I'm filling out Form 5472 to disclose a payment to a related party (a family member who provides services to my LLC). She doesn't live in the US, has no ITIN, and her home country doesn't issue indivi...
CP215 or CP15 — which IRS notice carries the Form 5472 penalty and how should I respond?
I just received an IRS notice about a Form 5472 penalty. Some sources online call this a CP15, others call it CP215. Are these different notices? Does the response procedure differ between the two? I ...
Can I e-file Form 5472 for tax year 2025 (returns filed in 2026)?
I much prefer e-filing to printing and faxing. Has the IRS opened up e-filing for Form 5472 with the pro forma Form 1120 for tax year 2025? Most tax software I have looked at says it cannot e-file thi...
How do I reconcile Stripe payouts to Mercury when QuickBooks shows different totals?
I'm seeing discrepancies between Stripe's gross sales for the month, Mercury's incoming deposits, and what QuickBooks shows. Some of it is timing (payouts in transit), some of it is fees, some of it i...
What is the agent-authorization rule under Reg 1.6038A-5 and when does it actually apply?
My CPA mentioned that my foreign parent company may need to authorize my U.S. LLC to act as its limited agent under Reg 1.6038A-5. I do not see any line for this on Form 5472 itself. Is this something...
How often does the IRS actually abate a Form 5472 penalty after assessing it?
I received a $25,000 Form 5472 penalty notice. A CPA quoted me $5,000 to fight it. Before I pay them, what is the realistic chance the IRS will remove the penalty if I just write a reasonable-cause le...
I filed Form 5472 on time — can the IRS still call it 'substantially incomplete' and assess the $25,000 penalty?
I filed Form 5472 by the April deadline last year, but I left some lines blank in Part II because I did not have my foreign owner's full address details. I also did not attach a separate statement for...
Which services are NOT allowed under the Services Cost Method? Where is the line for 'cost-only'?
I understand the Services Cost Method lets me charge some intercompany services at cost. But I want to charge my US LLC for a bunch of things my home-country team does — some of it is bookkeeping and ...
I exchanged my California property for an out-of-state one — do I really have to file FTB 3840 every year now?
I sold a California rental and exchanged into a replacement property in Texas. At the federal level I deferred the gain under Section 1031. Now I'm hearing California wants me to keep filing some form...
The section 1059A trap: my customs value is lower than my tax COGS — is that a problem?
I import from my own foreign company. For customs I declared a fairly low value, but for my tax return I want to book a higher cost of goods sold including my real landed cost. A friend mentioned 'sec...
SDOP vs SFOP — how do I know which Streamlined track applies to me?
I keep seeing 'SDOP' and 'SFOP' for the Streamlined Procedures and I can't tell which one I fall under. I'm a foreign citizen who spends part of the year in the US. Does it come down to where I live, ...
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