Understanding the United States Incorporation Process
Q: Can a Foreign Nationality Entrepreneur who isn’t a US Citizen or a US Resident be a shareholder of a US Corporation?
A: Yes. U.S. regulations permit a overseas nationality person to include a trade in the United States. You may also be open your US trade and be a sole shareholder.
Q: Can a Foreign Company (Corporation) be a sole shareholder of a US Corporation or Limited Liability Company?
A: Yes. A Foreign Company can cling 100% of the stocks of a US Corporation and/or a US Limited Liability Company. The US Entity might be a subsidiary of the Foreign Corporation.
Q: What will have to I imagine when opting for the kind of entity in the United States?
A: U.S. and States regulations be offering different types of trade entities for a Foreign Nationality Entrepreneur. When opting for your US Entity you will have to imagine the next problems:
1) Ownership Structure (Who are the shareholders? Individuals or Corporations? U.S. Residents or Foreign Nationality?
2) Tax Planning (what form of entity offers you essentially the most tax benefits within the U.S. and for your personal nation?
3) Business Purpose (what is going to be the character of your U.S. Business job – Online Trading, Real Estate, Retail, Manufacturing, Consulting, R&D, Wholesale, Marketing.
4) Future plans for fund elevating and/or including new shareholders. Do you intend to boost capital by means of going public? Will you will have extra shareholders sooner or later (U.S. Residents and/or Foreign Nationality).
Q: What are my choices as a Non-US-Resident with regards to Entity Types?
A: Non-US-Resident has the next choices to setup a US Entity:
1. C. Corporation, referred to as Sample Company Name, INC.
2. Limited Liability Company, referred to as Sample Company Name, LLC.
NOTE: There is every other form of Corporation to be had in the United States (S. Corporation). However, shareholders of S. Corporation will have to be us-residents.
Q: What are the similarities between Corporation and Limited Liability Company?
A: Corporation & LLC each have mutual benefits:
1. Separate Entity (from its shareholders) incorporate beneath State Laws.
2. Provide restricted legal responsibility to its shareholders. The entity is liable now not the shareholders.
3. Owners of the entity may also be folks or company even supposing they’re non-us-residents.
4. There isn’t any prohibit at the selection of homeowners / shareholders. Allow the entity to “cross public” or upload limitless selection of shareholders.
5. Allow other categories of stocks holders or possession (most well-liked, commonplace, and so on’)
6. Can be a U.S. Employer
Q: What are the variations between Corporation and Limited Liability Company?
A: One primary distinction between Corp & LLC is the Tax Treatment of the entity’s benefit and the best way every entity experiences its taxes to the tax government.
Corporation is a “Separate Entity” in the case of legal responsibility and taxes. Profits of C. Corporation are matter to Corporate Tax Rate (Federal & State Level) and the company is chargeable for its personal taxes. Dividends are matter to “dividend tax charges”.
Limited Liability Company is a separate entity in the case of legal responsibility BUT within the eyes of the tax government this can be a “pass-through tax entity”. Profits of an LLC aren’t matter to Corporate Tax Return on the LLC stage. They are added to the landlord’s taxable source of revenue. If the landlord is an Individual, the LLC’s earnings are matter to Individual Tax Rates and if the landlord is a Corporation, earnings might be matter to Corporate Tax Rates.
Annual Profit: $100,000
Individual Tax Rate: 26%
Income Tax: $26,000
Net Profit: $74,000
Owners web money waft: $74,000
Effective Tax Rate: 26%
Limited Liability Company
Annual Profit: $100,000
Corporate Tax Rate: 34%
Income Tax: $34,000
Net Profit: $66,000
Dividend Tax Rate: 15%
Dividend Tax: $9,900
Owners web money waft: $56,100
Effective Tax Rate: 43.90%
C. Corporation will have to record source of revenue, bills and benefit as a separate entity the use of Form 1120 (Corporate Tax Return).
LLC will have to report back to its contributors (homeowners) their percentage within the LLC’s benefit the use of Form K1. Each member will upload his/her percentage to his/her taxable source of revenue. Individual Member will document Individual Tax Return (Form 1040) , Corporation Member will document Corporate tax Return.
Q: How do I make a selection the most suitable choice for my state of affairs (Corporation or LLC)?
A: As you spot there are lots of issues in opting for form of U.S. Business Entity. We strongly suggest consulting with our professionals to succeed in the most efficient tax and trade benefits for your person cases. You would possibly touch us at : +1-202-742-6311
Q: Where do I incorporate my U.S. Business? Is it necessary through which State?
A: United States Is a Federation. There are fifty states and one district (District of Columbia). When you incorporate a US Entity, you must incorporate what you are promoting beneath state legislation – state of incorporation.
Q: How do I do know through which state I want to incorporate?
A: There is a fundamental rule in opting for your state of incorporation – “bodily presence” or “nexus”. Under State Law, when you’ve got a bodily presence within the State, you must incorporate beneath it. The which means of “Physical Presence” or “Nexus” is generally if you’re going to have an workplace, showroom, production or retail facility, make use of staff, ship or set up merchandise.
Q: Our Company is doing trade the use of our website online (on-line gross sales). We don’t want workplace and we do not want to make use of in the United States. Where will have to we incorporate?
A: If you should not have a “nexus” in any state, you might be loose to make a choice to include in any state. Incorporating what you are promoting in Delaware State offers you a large number of tax, felony and monetary benefits.
Q: What are the necessities for a non-us-resident to include in Delaware?
A: In order to Incorporate in Delaware (or in every other state) you will have to practice those steps:
1. Fill out our Incorporation Application Form at: GlobesAmerica.com
2. You will have to have to be had:
Copy of your passport (with picture ID and an evidence of cope with for your nation)
3. You want to supply us two title tips on your US entity. We will examine with the State that the title is to be had.
4. There isn’t any quantity of Share Capital required by means of the state.
Q: What occurs after you obtain my Incorporation Application Form?
A: Our Processing Department evaluations your utility and provides an preliminary approval. Your utility now is going to our Incorporation Team to continue with the Incorporation Process. At this level you’re going to obtain your Incorporation bill and a Credit Card Authorization shape to fill out, signal and ahead again to us. After processing your cost we will be able to e-mail you a affirmation and proceed with the method.
Q: What are the Incorporation Steps?
A: Here are the stairs incorporated within the Incorporation Process:
1. Name Check: We run a reputation take a look at with the State. If the title you asked is to be had we will be able to transfer ahead with the incorporation. If the title is unavailable we will be able to ask you to offer a brand new title advice.
2. File your Incorporation Application with the State: We get ready your incorporation utility to the State. One of the main paperwork each and every state calls for to incorporate within the utility is Article of incorporation (in case you setup a Corporation) or Article of group (in case you setup an LLC). As a part of the method we will be able to get ready the Articles and ensure they’re complied with State Laws & Regulations.
3. Resident Agent: We have interaction a Resident Agent on your entity, which is a trade or person designated to obtain carrier of procedure (SOP) when a trade entity is a celebration in a felony motion corresponding to a lawsuit or summons. The registered agent’s cope with can be the place the state will ship the bureaucracy for the once a year renewal of the trade entity’s constitution.
4. Tax ID Number: We retrieve from The Internal Revenue Service (IRS) an Employer Identification Number (EIN), which recognized additionally as Tax ID Number. The EIN is a statutory requirement if you wish to have to behavior trade in the United States, Open a Bank Account, File Tax Return, Apply for Credit or Employ staff.
5. Business Address: Your entity might be assigned a Business Address within the State of Incorporation. The trade cope with might be used to obtain mail pieces and ahead to you anyplace on the earth. You might also use the trade cope with in your letterheads, legit company correspondence and felony paperwork.
6. Corporate Kit: We get ready a Corporate Kit on your US Entity which incorporates essential paperwork: Certificate of Incorporation / group, State Filling Proof, Share-Holders Agreement / Member-Ship Agreement, Share Certificates / Member Certificates (Proof of possession) and Shares Registered Log.
Q: How lengthy it takes to finish the Incorporation Process?
A: We get ready and document your incorporation utility inside of 24 hours upon receipt of your cost. Most States will take 24-48 hours to procedure and approve the appliance. It will take every other 24-48 hours to retrieve your EIN and get ready the Incorporation Kit.
Q: Are there annual charges to stay my company in excellent status?
A: Every State calls for to take care of the company or restricted legal responsibility corporate by means of paying annual charges. The annual charges range from $50 to $800 relying at the State of Incorporation. We will notify you at the due date and help you with the right kind filling and cost of the once a year charges to stay your entity in excellent status.
Q: Do I want to document Tax Return?
A: Yes, Every entity required to document an annual tax go back to the IRS and the State which it’s doing trade in. Some States additionally require Franchise Tax Return. Our Tax Specialists will help you with getting ready and submitting the desired tax go back.
Q: Can my Corporation / LLC make use of staff in the United States?
A: Yes. Every US Entity may also be an employer. You must sign in the entity within the State of Employment as an Employer and make the right kind Payroll Arrangements. Our Payroll Department will help you in registering your entity as an Employer and make the essential payroll preparations to permit you utilize staff in the United States.
Q: What do I do, if I’ve questions on taxes, accounting and trade transactions associated with my US Corporation / LLC?
A: Every consumer has a Dedicated Business Advisor (DBA) who’s your Corporate guide in Globes America. You have limitless get right of entry to for your DBA by way of e-mail, telephone and on-line chat. You would possibly discuss with your DBA on each and every factor associated with what you are promoting actions in the United States.