How to set up a company in the USA as a Non-Resident?

Setting up a company in the USA as a non-resident can offer you several advantages including credibility, funding opportunities and access to a lucrative market. This comprehensive guide will walk you through the step-by-step process of incorporating your company in the US, even if you reside elsewhere.

Stepwise Process to Set Up a Company in the USA

1. Choose Your Business Structure

As a foreign entrepreneur in the United States, you have two main options for your business structure: the C Corporation and the Limited Liability Company (LLC).

Let’s take a closer look at both the C Corporation and the LLC to help you understand which might suit your needs.

C Corporations

A C Corporation is a separate legal entity from its owners/shareholders, protecting their personal assets from the company’s actions and debts.
Profits and losses belong solely to the corporation. With a C Corporation, you can sell an unlimited amount of stock or shares, and even take the company public if desired. Investors typically favor this structure, which is advantageous if you plan to expand and seek outside investment.
Drawbacks include increased paperwork, additional deadlines for compliance, and double taxation, where the corporation and individual shareholders pay taxes on profits.

Limited Liability Companies (LLCs)

LLCs offer liability protection similar to C Corporations but with fewer compliance requirements.
Owners are called members, and an LLC can choose to be taxed as a C Corporation or pass profits and losses to owners.

Learn more about it at: How do I start a LLC business in America as a foreigner

2. Choose the State for Formation

While most resident entrepreneurs establish their businesses where they live, as a nonresident, you can file your business entity in any U.S. state.

Popular choices include California, Delaware, Nevada, Texas, and Wyoming.

Consider factors such as the state’s business environment, access to resources like materials and employees, and the costs of doing business.
Some states offer tax incentives, while others have high tax rates. Research thoroughly to find your ideal location.

3. Hire a Registered Agent

A registered agent, also known as a resident agent, is officially recognized by the state of incorporation. They accept legal documents on behalf of your company. Since you’re not in the U.S., having a registered agent can help manage legal paperwork, handle official notifications, and ensure compliance. Requirements vary by state, but generally, the agent must have a physical address within the state and be available during business hours. It is mandatory to have a Registered Agent in US to incorporate a company as an non-resident.

4. Obtain a Taxpayer Identification Number

All U.S. businesses need a Taxpayer Identification Number (TIN) for tax purposes. As a foreign entrepreneur, you can apply for an Individual Taxpayer Identification Number (ITIN) since you don’t have a Social Security number. To get an ITIN, complete IRS Form W-7 with documentation proving foreign status and identity.

5. Set Up a Business Bank Account

To manage your U.S. business effectively, open a bank account based in the U.S. You’ll need official corporation documents, an ITIN, and a passport. You can open a corporate bank account online with E-StartupIndia’s assistance.

6. Maintain Business Compliance

Business compliance continues after starting your business. You must file an annual report, regardless of your business structure, to keep information current with the state. As a non-resident, you’ll pay taxes on U.S. income and potentially an annual fee to the state of incorporation.

FAQs

Can I set up a Company in the USA as a non-resident without a US visa?

Yes, owning a US company is separate from working in the US. You can be a shareholder or owner without a visa. However, if you plan to manage the business from within the US, you may need a work visa depending on your business activities.

How long does it take to set up a US company?

The processing time can vary depending on the chosen state. Generally, it can take anywhere from a few days to a few weeks.

What happens if my business name is already taken?

It’s important to conduct a business name search before filing. Most states have online tools for name availability checks. If your desired name is unavailable, consider alternative options or add modifiers to make it unique.

Do I need a US mailing address?

Yes, you will need a US mailing address for your business to receive official documents and communication. Registered Agents can provide a US mailing address as part of their package.

How to set up a company in USA as a Non-Resident?