Establishing a business in the USA is accessible for non-citizens. This guide provides essential information for starting your business journey in 2024.
Select the Appropriate Business Structure
Non-citizens do not need a US visa or social security number to register a business in the USA. However, choosing the right business structure is crucial. The two primary options are Limited Liability Company (LLC) and C Corporation (C Corp). Each has distinct implications for business operations and taxation.
Key Differences Between LLCs and C Corps
| Aspect | LLC | C Corporation |
| Taxes | Members pay personal income tax only. | Subject to double taxation (corporate and shareholder levels). |
| Stock Market | Cannot issue stocks. | Can issue stocks. |
| Financing | Limited to debt or equity offers. | Easier to raise capital through unlimited shareholders. |
Similarities Between LLCs and C Corps
| Aspect | LLC and C Corporation |
| Liabilities | Both structures treat companies as separate entities from their owners, protecting personal assets. |
| Tax Filing | Required to file taxes quarterly. |
| Type of Owners | Individuals and corporations, both domestic and international, can be members or shareholders. LLCs are limited to 100 members, whereas C Corps have no such restriction. |
Which Structure is Best for Non-Citizens?
Choosing between an LLC and a C Corp depends on your business goals. C Corps are preferable for raising substantial capital due to their flexibility and security for investors. Conversely, LLCs are advantageous for avoiding double taxation, making them appealing to many foreign business owners.
Selecting the Best State for Your Business
Choosing the right state for your business is critical, as state laws impact profits, taxes, and operations. Delaware and Florida are particularly attractive for their business-friendly environments.
Comparing Delaware and Florida
| Aspect | Delaware | Florida |
| Incorporation Fees | $89 for Corps, $90 for LLCs. | $70 for Corps, $125 for LLCs. |
| Franchise Tax | 8.7% on net income for corporate, 2.2–5.95% for individuals. | No franchise tax. |
| Anonymity | Limited; some public information required. | No anonymity; public access to information. |
| Executive Management | More rigid processes. | Greater flexibility in profit distribution and executive roles. |
Essential Documentation
Starting a business in the US does not require physical presence or an American visa. Key steps include:
- Business Address: Obtain a physical business address. ExportManager offers a Virtual Address service, enabling you to use their mailroom as your business address.
- Employer Identification Number (EIN): Apply for an EIN from the IRS. If you lack a social security number or Individual Taxpayer Identification Number, complete Form SS-4. Processing may take several weeks.
- Business Bank Account: ExportManager partners with Mercury to provide banking services. After setting up your business with ExportManager, you can open a business bank account with Mercury. Transfer $10,000 within the first 90 days to receive $250 cashback, subject to approval.
Final Thoughts
The United States offers unparalleled opportunities for global entrepreneurs, including access to investors and a structured financial system. By selecting the appropriate business structure and location, and completing necessary documentation, non-citizens can successfully establish and grow their businesses in the US.