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've been transacting business in Texas for over a year without registering — how bad are the late penalties?
I realized my LLC has had a Texas office and local activity for more than a year and I never registered as a foreign entity in Texas. Now I want to fix it. How does Texas calculate the late-registrati...
Form 5472 valuation: when can I use a reasonable estimate instead of an exact amount?
I have an intercompany services charge between my foreign-owned Wyoming LLC and my parent company in Singapore, but I can't get the exact figure until the parent's books close in late April. Form 5472...
What actually changes between 2025 and 2026 on Form 1099-DA?
I keep reading that 2025 was the first Form 1099-DA year and that 2026 adds basis reporting, but the explanations contradict each other. My LLC received a 2025 statement that lists sale proceeds and n...
Our trust deed names no US beneficiaries — does that protect me from the grantor trust rules when I move to the US?
My parents and I set up a foreign trust years ago. The deed lists only family members in our home country, and nobody in the family lives in the US today. I'm planning a move to the States for my star...
Selling my 40% of a two-member US LLC — what does section 864(c)(8) actually do to my gain?
Our LLC has two foreign members and files Form 1065 as a partnership. I'm selling my 40% interest to a US buyer. I assumed my gain would be foreign-source capital gain with no US tax, but the buyer's ...
Our payroll will be tiny — can my LLC just file annual Form 944 instead of quarterly 941s?
Founder in Turkey here. My US LLC is hiring one part-time employee starting July 2026, maybe ten hours a week. Total federal employment tax for the year will clearly be under a thousand dollars. My pa...
How do I identify the 'US customer subset' of my Stripe transactions for a defensive ECI filing?
I've decided to do a defensive ECI filing with a small voluntary amount on 1040-NR. My question is methodological — Stripe shows me a lot of customer data, but which fields actually justify treating a...
Are there sale prices where FIRPTA drops to 10% or even zero?
I'm a foreign seller and a friend mentioned that smaller home sales sometimes get a reduced FIRPTA rate, or no withholding at all, if the buyer is moving in. Is that real? What price thresholds matter...
Can a non-resident owner of a US LLC elect S-corp status with Form 8832 then Form 2553?
I keep reading that an S corporation saves on self-employment tax. I'm a non-resident alien and own a US LLC. Can I file Form 8832 to become a corporation and then Form 2553 to elect S status? Is ther...
My books live in Xero in Europe — can I keep my LLC's records abroad or do they have to be in the US?
All of my LLC's bookkeeping is in a cloud accounting tool hosted in Europe, and my contractor invoices and bank records are over here too. Does section 6038A require me to physically keep the records ...
Does FBA inventory create sales tax physical nexus even if Amazon collects the tax?
Amazon already collects and remits sales tax on my marketplace orders under marketplace facilitator laws. So does the fact that my FBA inventory physically sits in warehouses across several states sti...
I'm paying a foreign freelancer who did work inside the US — do I withhold, and is W-8ECI the right form for a treaty claim?
My LLC hired an independent contractor based abroad. For one project they actually flew to the US and performed the work here. They asked to send me a W-8ECI so I don't withhold, and they mentioned a ...
My Stripe 1099-K triggered a CP2000, but I already reported that income — what do I do?
I run my business through a US LLC and Stripe issued a 1099-K. The IRS sent a CP2000 treating the whole 1099-K as unreported income, but I did report those sales on my return. I think the problem is t...
How do I actually backfile old FBARs, and how many years do I have to go back?
I need to file FBARs for years I missed. Is there a paper form I mail, or is it all online now? And how far back do I have to go — every year I ever had an account, or some cutoff?
How is the gross-profit percentage on Form 6252 actually calculated?
I keep reading about a 'gross-profit ratio' on the installment sale. How do I actually compute it, and how does the mortgage the buyer is assuming affect it? I want to estimate how much of each paymen...
If I should have filed Form 8938 but didn't, does that keep my tax year open too?
My LLC may have crossed into being a specified domestic entity, and I think I should have filed Form 8938 with the return but didn't. Separate from the $10,000 penalty, does leaving Form 8938 off the ...
Is my SaaS subscription subject to US sales tax, and if so in which states?
My foreign-owned LLC sells a monthly software-as-a-service subscription to US customers — no physical product, just hosted software they log into. Do I have to charge US sales tax on SaaS? I keep gett...
My ITIN expired without any notice from the IRS — does this affect my old returns?
I just learned that ITINs expire after 3 years of non-use. My ITIN was issued in 2020 and I haven't filed any tax returns since 2021. Does that mean my ITIN is expired now? Does the expiration retroac...
Can I form a Wyoming LLC first, then later move into Stripe Atlas if I need to?
I'm leaning toward self-forming a Wyoming LLC for cost reasons, but I'd like to keep the Atlas option open. Can I form Wyoming now and then move the LLC into Stripe Atlas later if I need their bundled...
Crypto exchange wants a W-9 from my US LLC, but the owner is foreign — is that the right form?
During onboarding, a US exchange asked my LLC for a Form W-9 because it is a US-registered entity with an EIN. The LLC is a single-member disregarded entity and I (the only owner) am not a US person. ...
What are the Form 1116 'baskets', and why might I have to file more than one?
My accountant mentioned I might need more than one Form 1116 because my foreign income falls into different 'baskets'. I have some foreign dividends and also some foreign consulting income through my ...
My foreign corporation owns a US LLC — do I file BOTH Form 1120-F and Form 5472?
Structure: a corporation in my home country owns a US single-member LLC. The LLC is disregarded. I've been filing Form 5472 with the pro forma 1120 for the LLC every year and assumed that covered ever...
Can I add myself to my LLC's payroll now that it runs payroll for a real employee?
I live in the UAE and own a US single-member LLC. We just hired a US employee and a payroll provider now runs Form 941 filings for the LLC. Since the payroll machinery exists anyway, I'd like to put m...
Which of my US assets are actually 'US-situs' for estate tax — and which are exempt?
I hold a mix of US things: shares of US companies, some shares of a non-US company, cash in a US bank, cash sitting in a US brokerage account, and a life-insurance policy on myself. Which of these wou...
All my viewers and sponsors are American but I work from home abroad — does that give me ECI?
My audience is almost entirely US-based and most of my sponsors are US companies, yet I film, edit, and run everything from my apartment overseas with no US office or staff. People keep warning me tha...
I keep reading that nonresidents don't pay US tax on capital gains — so is selling my US LLC tax-free?
I live outside the US with no green card and no US presence. Forums say a nonresident's capital gains are generally not taxed by the US, so a friend told me I can sell my US LLC and owe nothing. That ...
My qualified intermediary holds all the sale funds — doesn't that solve the FIRPTA withholding problem?
In my exchange, the qualified intermediary receives all the net sale proceeds and holds them until I buy the replacement. So I never touch the money. Doesn't that mean there's nothing to withhold FIRP...
Does routing my China-made goods through Vietnam change the country of origin?
To get around China tariffs, my supplier offered to ship my Chinese-made products to Vietnam, repack and relabel them as 'Made in Vietnam,' then export to the US. Does that actually change the country...
What does it actually cost to foreign-qualify in New York, and what's this 'publication requirement' I keep hearing about?
I might need to register my out-of-state LLC in New York. The state filing fee doesn't look bad, but everyone mentions a 'publication requirement' that can get expensive, especially in certain countie...
What is the 'material profit and loss statement' rule and does my small LLC have to worry about it?
Reading the section 6038A regs, I keep hitting this 'material profit and loss statement' concept with thresholds like $25 million and $100 million. My LLC does maybe $200k a year. Do these rules apply...
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