Despite the growing competition in the international scenario, the United States remains ranked as the world’s number one economy. Every year, many foreign entrepreneurs try to find ways to onboard this lucrative market and take advantage of endless opportunities in high-performance segments.
In this article, you will discover the fundamental steps to start a US company from abroad.
How Do I Start a US Company from Abroad? – Step-by-Step
It is perfectly possible to own a business in the United States when you are neither a US citizen nor a resident. No US law restrains the ability of non-residents to form a new business enterprise or purchase an existing business.
Non-US residents can freely choose in which state they wish to form a company. Different states have distinct formation rules and tax implications. Hence, it is crucial to seek expert guidance from a well-versed attorney before taking the plunge.
Finding a Unique Business Name
The first step to setting up a US business is to find a proper name for the company. There are specific rules at the state level that require legal names to be distinguishable from other entities registered within the same state.
Depending on the chosen business structure, the decision will also determine whether the selected name is acceptable.
Hiring a Registered Agent
The registered agent is the point of contact between the foreign-owned company and the state, which can be an individual or an organization located in the state where the business is registered.
The role of the registered agent is to receive official correspondence on behalf of the company, such as official notices, lawsuits, liens, subpoenas, and service of process in general.
Registering the Company
The next step is to file the paperwork to form the company. Choosing the appropriate business structure for a foreign-owned company requires a careful approach, as it will determine the tax implications and other crucial elements.
Foreign nationals can choose between C-Corporations, Limited Liability Companies (LLCs), or Partnerships. Non-US residents cannot form S-corporations, which is one of the few restrictions imposed by US law.
Each state has its own rules for business formation. For example, forming an LLC in Florida requires foreign entrepreneurs to file Articles of Organization with the Department of State. Consult with a well-versed lawyer to ensure full compliance throughout the whole process.
Apply for an Employer Identification Number (EIN)
The Employer Identification Number (EIN) is issued by the Internal Revenue Service (IRS) to identify companies registered in the United States for tax purposes.
Also referred to as the “Tax Identification Number,” the EIN is necessary to conduct business activities such as:
- Filing taxes
- Opening a business bank account
- Hiring US employees
- Seeking business financing with loans
Obtaining a Mailing Address & Opening a Bank Account
As expected, non-US residents do not have a mailing address in the United States. While a registered agent will handle the service of process on the company’s behalf, it is fundamental to obtain a proper address to receive business mail.
Foreign-owned businesses also need a US bank account, which is often the most challenging step involved in the process to set up a US business remotely. Fortunately, the guidance of an expert attorney can help you overcome this recurring inconvenience.