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'm selling my interest in a U.S. LLC that owns real estate — does FIRPTA apply to the sale of my LLC membership interest?
I own a 30% membership interest in a Florida LLC that holds two apartment buildings. I want to sell my interest to another investor (who is a U.S. person). The LLC itself isn't selling the properties ...
What happens when a disregarded entity LLC adds a member and becomes a partnership?
I currently own a single-member US LLC that is treated as a disregarded entity. I am planning to bring in a business partner and add them as a member of the LLC. I understand this will change the tax ...
How does the Section 250 deduction reduce tax on GILTI for corporations?
I own a U.S. C-corp that has CFC subsidiaries. My understanding is that there's a deduction under Section 250 that lowers the effective tax rate on GILTI for domestic corporations. How exactly does th...
What is the difference between a general partnership and limited partnership for taxes?
My cousin and I are starting a real estate investment project and we're debating between a general partnership and a limited partnership. I know the liability is different, but how does the taxation w...
What are the tax implications when I lend money to my foreign LLC or make capital contributions?
I'm the sole foreign owner of a U.S. LLC. When I first started the LLC, I transferred $5,000 from my personal account to the LLC's Mercury account to cover initial expenses. I also plan to lend the LL...
I received a Form 8805 from a U.S. partnership. How do I use it on my 1040-NR?
I'm a non-resident alien living in Japan and I'm a 30% partner in a U.S. LLC taxed as a partnership. The partnership sent me Form 8805 showing they withheld about $22,000 in tax on my share of partner...
What state-level payroll taxes must my foreign-owned LLC pay beyond federal taxes?
I understand federal payroll taxes (FICA, FUTA, income tax withholding) but I'm completely lost on state requirements. My foreign-owned LLC is registered in Wyoming but my employee works in California...
How do I know if my LLC is a disregarded entity or a partnership?
I keep seeing these terms but I'm confused. I'm the only owner of my LLC. Does that automatically make it a disregarded entity? What if I add a partner later?
What cost basis methods can I use for crypto in my foreign-owned LLC — FIFO, LIFO, or specific ID?
I've accumulated Bitcoin over several years through my LLC, buying at different prices. Now I'm selling some. My crypto tax software lets me choose between FIFO (first in, first out), LIFO (last in, f...
Can I mix typed and handwritten entries on Form 5472? My software only printed '202' in the year field and I added the '5' by hand.
I used a filing tool to generate my Form 5472 and pro forma 1120. When I printed the forms, I noticed the year field only shows '202' instead of '2025.' I handwrote the '5' to complete it. Also, a fe...
What retirement plan options are available for foreign LLC owners?
As a foreign national who owns and works in my US LLC, I am interested in setting up a retirement plan that provides tax benefits. I have heard about SEP-IRAs, SIMPLE IRAs, and solo 401(k) plans. Are ...
Should my foreign-owned LLC use a PEO for payroll and HR — what are the pros and cons?
As a foreign owner of a U.S. LLC, I find U.S. payroll incredibly confusing. Someone recommended a PEO (Professional Employer Organization) that would handle everything — payroll, benefits, HR complian...
Can my foreign-owned LLC file Form 944 instead of quarterly Form 941?
I have a tiny foreign-owned LLC with one part-time employee whose total annual wages are about $8,000. Filing Form 941 every quarter seems like a lot of paperwork for such a small amount. I heard ther...
What is IRC 338 and when would a foreign buyer use a Section 338 election when acquiring a U.S. company?
My investment group from South Korea is acquiring 100% of a U.S. C-corporation. Our M&A attorney mentioned making a 'Section 338 election' that would treat the stock purchase as an asset purchase for ...
ESTA/Visa Waiver and managing your U.S. LLC
I am from a Visa Waiver Program country and I enter the U.S. on ESTA for short business trips. I own a U.S. LLC that operates an e-commerce store. During my ESTA visits, I sometimes handle shipping lo...
Can I use PayPal Business for my foreign-owned U.S. LLC?
I run a foreign-owned LLC and some of my clients prefer to pay via PayPal. I already have a personal PayPal account linked to my home country. Should I open a separate PayPal Business account for my U...
L-1 intracompany transfer and LLC ownership
My company abroad is transferring me to the U.S. on an L-1 visa. I also own a separate personal LLC in the U.S. for freelance consulting work. Can I maintain ownership of my personal LLC while on an L...
I missed the April 15 deadline for Form 5472. What do I do now?
I completely forgot about filing Form 5472 and the deadline passed two weeks ago. Am I automatically getting the $25,000 penalty? Is there any way to reduce or avoid it?
Wyoming vs Delaware LLC — does it matter for Form 5472?
I'm about to form my LLC and can't decide between Wyoming and Delaware. From a Form 5472 perspective, does it make any difference which state I choose?
Does self-employment tax apply to non-resident alien LLC owners in the U.S.?
I'm a non-resident alien from South Korea who owns a single-member LLC. My accountant mentioned something about self-employment tax being 15.3% on top of income tax. That seems really high. As a non-r...
How important is it to separate personal and business bank accounts for my foreign LLC?
I have a foreign-owned LLC and I've been using my personal Wise account to receive some client payments alongside my Mercury business account. Some smaller clients pay to my personal Wise because it w...
Visa overstay and LLC tax filing obligations
I overstayed my visa and I am now out of status in the U.S. I still own an LLC that continues to generate income. I am worried about my immigration situation, but I also want to know about my tax obli...
I transferred my software IP to my foreign corporation. Do I need Form 926?
I'm a U.S. person and I recently incorporated a company in Ireland for tax and business reasons. I transferred ownership of my software intellectual property (valued at approximately $2 million based ...
A contractor for my foreign-owned LLC won't give me their TIN — do I have to withhold 24%?
I hired a freelance writer through my foreign-owned LLC. When I asked for their W-9, they said they'd send it later and never did. I've already paid them $2,500 over several months. Now they're pushin...
Do wash sale rules apply to cryptocurrency losses in my foreign-owned LLC?
My LLC sold some Bitcoin at a loss and then repurchased it the next day to maintain exposure. With stocks, the wash sale rule would disallow the loss. But I've heard that crypto is exempt from wash sa...
Does FATCA (Form 8938) apply to cryptocurrency held on foreign exchanges through my LLC?
I've read about FATCA reporting requirements for foreign financial assets. My foreign-owned LLC has accounts on Binance International and KuCoin (both foreign exchanges). The total crypto value fluctu...
Selling my NYC condo as a foreign owner — any special FIRPTA rules for condos and co-ops?
I'm a British citizen selling my Manhattan condo that I bought as an investment 5 years ago. The expected sale price is around $850K. I also looked at buying a co-op years ago but ended up with a cond...
What are the income tax consequences when I inherit my foreign parent's U.S. LLC?
My mother was a non-resident alien who owned a single-member U.S. LLC that holds rental properties. She recently passed away and I (a U.S. citizen living in California) am inheriting the LLC. What hap...
I'm renouncing U.S. citizenship. What is Form 8854 and the exit tax?
I've been a dual citizen (U.S. and Australia) my whole life but have lived in Australia since I was 5. I've decided to renounce my U.S. citizenship because the annual filing obligations and FATCA repo...
What are the tax consequences of dissolving a foreign-owned LLC?
I am considering closing my US LLC and returning to my home country permanently. What are the tax consequences of dissolving an LLC when the owner is a foreign national? Are there final tax returns I ...
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