Can my foreign company charge my US LLC for bookkeeping and IT support at cost with no markup?
I personally handle the LLC's bookkeeping, payroll coordination, and IT help-desk stuff through my company back home, and I want to invoice the LLC for it. An accountant said I have to add a profit markup like a real services business would. But I also read about a 'Services Cost Method' that lets you charge at cost with no markup. Can I use that for routine back-office support, and what makes a service eligible?
Related Questions
Can my foreign parent charge my US LLC a 'management fee' for oversight and governance — or is some of that not chargeable at all?
My overseas holding company wants to bill my US LLC a flat annual 'management fee' that covers, among other things, my own time overseeing the investment, parent-level governance, and some legal/regul...
What interest rate do I have to charge on a loan from me (the foreign owner) to my US LLC?
I wired money into my US LLC to fund operations and we're calling it an owner loan. What interest rate keeps the IRS happy under the section 482 rules? Is there a safe range tied to the AFR I can just...
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 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...
What does a realistic, low-cost annual transfer pricing file look like for a one-person foreign-owned LLC?
I'm convinced I need SOMETHING, but I can't justify a full economist report every year for a small LLC with a couple of related-party items. If I want a proportionate annual package that still holds u...
My foreign company owns the brand and charges my US LLC a royalty — how do I set it, and what is 'commensurate with income'?
My home-country company owns the trademark and some software, and licenses them to my US LLC for a royalty. The US LLC is also spending heavily on US marketing to grow the brand here. How do I set a d...
My US LLC does routine production for my foreign company — is cost-plus or CPM the right method?
Flip side of the importer question: here my US LLC actually makes/assembles goods for my foreign affiliate on a routine basis. It's contract-manufacturing style work, not designing or owning anything ...
What is IRC 482 transfer pricing and can the IRS reallocate income between my foreign company and my U.S. LLC?
I own a software company in Ireland and a separate LLC in Delaware. My Irish company licenses software to the U.S. LLC, which sells it to U.S. customers. My CPA warned me about IRC 482 'transfer prici...
Can the IRS get my passport revoked if my Wyoming LLC owes back tax?
I'm a Mexican citizen with a Wyoming LLC. The LLC has unpaid Form 5472 penalties from 2023 and 2024 totaling around $50,000. I just renewed my Mexican passport and I'm planning to visit the U.S. for a...
We have intercompany pricing, but no real section 6662 documentation. Is that automatically a penalty disaster?
The company does have contracts and invoices, but not the kind of formal transfer pricing study people usually mean when they talk about section 6662 documentation. Now that a return review is happeni...
Have a similar question?
ForeignLLCTax members get expert answers with IRS citations. One CPA consultation costs $200+. Full access is $9.99/month.
Become a Member — $9.99/moDisclaimer: All content on ForeignLLCTax.com is created by a tax professional and is provided for general educational and informational purposes only. It does not constitute tax, legal, or accounting advice, and should not be relied upon as such. Every tax situation is different — for advice specific to your circumstances, please consult a licensed CPA, Enrolled Agent, or tax attorney. By using this website, purchasing a subscription, or accessing any tools or services, you acknowledge that no client-professional relationship is established between you and ForeignLLCTax.com or its operators. This website is not affiliated with the IRS.
