Business in the US, can a non citizen start a business in the US

Starting a Business in the US as a Non-citizen – Simple Guide

It can be exciting, but also daunting to start a business in the US. Opening a shop in another country can be a complex process.

It’s good to know that the steps for incorporating as a citizen who is not a US resident are relatively simple. There are also many resources to guide you. This guide will break down the complexity of opening your US business.

Which types of corporate entities am I able to open in the US if I’m not a resident?

Currently, non-citizens are allowed to open two types of corporations in the US.

  1. Limited Liability Company
  2. Corporation (C-Corp)

S-Corporations are another option that is often recommended to non-citizens. Although they’re quite attractive, you should be aware that these are only available to permanent residents and citizens.

Although foreigners are often advised to form a C-Corp, incorporating as an Inc has distinct advantages. One of the most obvious is limited liability. Members are not personally liable for any business decisions or actions. Personal assets are also protected if the company is sued or incurs debt.

Many new businesses opt for the C-Corp structure. One of the advantages to forming a C-Corp is that it allows for unlimited stock. 

This feature often attracts investors.

C-Corporation structures are also popular with foreign owners, as they offer protection from I.R.S. involvement. involvement. This shield comes at a price, however, and that is double tax. This financial damage can often be avoided by careful tax planning.

Do I need a US visa to start a business in the US?

Managing an LLC outside of the US is possible, but it may only be allowed within the US if you have a valid visa.

However, if you plan to manage the LLC from within the US, you may need a valid work visa. You may require a valid visa if you intend to manage your LLC within the US.

In general, you will need a visa to perform your duties as an officer in the US. It is legal to work for your LLC or corporation in the US with a valid visa.

A US-based business does not give you the right of residence in the US. Many prefer to have one.

There are several visa options available.

Options for visas for non-residents to open a business in the US

The E-2 visa is the most popular for entrepreneurs. It’s the closest the US has to a “startup visa”. Three main requirements are required to obtain one:

  1. You have to be a citizen of one of the countries that are part of the Treaty of Friendship, Commerce, or Navigation between the US and the country you’re from. You can find a complete list of treaty countries on the Department of State’s Treaty Countries Website.
  2. You must be investing or planning to invest significant capital in an American business. There currently needs to be a minimum amount you must invest. However, you may have difficulty getting the visa if your investment is less than $100,000. The requirements state that the money must be a significant portion of your own funds.
  3. You have to be able prove that you own a majority share (50%) or more of your business
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The E-2 visa allows your spouse to qualify for a work permit and it can be extended indefinitely. The E-2 visa needs to provide a clear pathway to obtain your Green Card. Starting your business in the US and entering on an E-2 will likely result in your permanent status as a Non-Resident Alien.

E-2 Visa alternatives

You can explore many other visas if the E-2 is not for you. The US Citizen and Immigration Service Entrepreneur Visa Guide has a complete list, but the most popular include:

  • The F-1 (Optional Practical training) Visa is for students with an F-1 Visa in the US who want to open a business directly related to their major.
  • The Specialty Occupation Visa requires that you work in a job which typically requires an advanced bachelor’s degree or higher in a specialty field.
  • O-1A Extraordinary Ability and Achievement Visa is awarded to individuals who have demonstrated “extraordinary abilities” in the arts, sciences, education, business or athletics. You may need to be recognized nationally or internationally in your field.

You may be eligible to receive a US Green Card by Investment, making you a permanent US resident.

In which state should I register my company?

It is best to register your business in the state where you plan to conduct it. Suppose you are an online business or you do business in multiple regions. In that case, registering your company in a lower-tax state may be worth registering.

Nevada and Delaware are two states known for their low cost of living. Delaware is a popular state because of its corporate law, which provides protections for shareholders and directors.

Delaware does not require either a physical or bank address to incorporate. Delaware is welcoming of foreign entrepreneurs, and its corporate law website can be accessed in a number of different languages.

How do I register my company?

The registration process in the US for foreign companies varies from state to State and depends on whether it’s an LLC or C-Corp. Delaware’s company registration process is an excellent model of the required steps and basic requirements.

  1. Choose a unique name that has never been registered in the United States. You can search the trademark database at the US Patent and Trademark Office.
  2. The company’s documents must be received by you or an agent named in the company.
  3. You will need to fill out the certificate of incorporation once you have established your agent and name. This document contains the name of the company, your address or the agent of your company, the number of shares authorized, as well as the legal name and address of the incorporator. The filing fee for the certificate of incorporation is $89, and it increases depending on the amount raised or stock issued.
  4. You’ll then need to file an incorporation statement and pay franchise tax.
  5. You must also obtain an employer identification (EIN) number. You can use the EIN to open a bank, pay taxes and get any licenses that you may need. The IRS allows you to apply online for a free EIN. You or the principal officer of your company must already have a Taxpayer ID Number. You can still apply for an EIN if neither you nor the company’s principal officer has one. However, you will need to do so by mail or fax.
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FAQ on How to Get US business and a US Business account details as a non-citizen:

Can non-citizens start a business in the United States?

A: Yes, non-citizens can start a business in the United States. However, they will need to follow certain rules and regulations.

What are some of the legal requirements for starting a business in the US as a non-citizen?

A: As a non-citizen, you will need to obtain a tax identification number (TIN) or an employer identification number (EIN) from the Internal Revenue Service (IRS). You may also need to obtain a business license and register your business with the appropriate state agency.

What are the advantages of incorporating a business in Nevada or Delaware?

A: Both Nevada and Delaware are popular choices for incorporating a business due to their business-friendly laws and tax structures. Delaware is known for its well-established legal system and corporate law, while Nevada is known for its low taxes and minimal regulation.

How do I incorporate a business in Nevada or Delaware as a non-citizen?

A: Non-citizens can incorporate a business in Nevada or Delaware by following the same process as a US citizen. You can hire a registered agent in the state to help you with the process.

What are the tax implications of incorporating a business in Nevada or Delaware?

A: Both Nevada and Delaware have favorable tax structures for businesses. Delaware has no sales tax and a relatively low corporate income tax rate. Nevada also has no corporate income tax and no personal income tax.

Can non-citizens open a bank account for their business in the US?

A: Yes, non-citizens can open a bank account for their business in the US. However, you will need to provide certain documentation, such as your TIN or EIN, and proof of identification.

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Are there any restrictions on non-citizens owning a business in the US?

A: Non-citizens can own a business in the US, but there may be restrictions depending on the type of business and industry. For example, certain industries, such as telecommunications and aviation, may have restrictions on foreign ownership.

Do non-citizens need a visa to start a business in the US?

A: It depends on the type of business and the individual’s immigration status. Suppose you are in the US on a non-immigrant visa, such as a student or work visa. In that case, you may be able to start a business, but you may need to obtain a work authorization or change your visa status. If you are outside the US, you may need to obtain an investor visa, such as an E-2 visa, to start a business in the US.

Can non-citizens hire employees for their business in the US?

A: Yes, non-citizens can hire employees for their business in the US. However, they will need to ensure that all employees are authorized to work in the US and comply with all federal and state employment laws.

Final Words on Starting a Business in the US as a Non-citizen

Starting a business in the US as a non-citizen is definitely possible. However, it requires careful planning and compliance with various legal requirements. Incorporating your business in Nevada or Delaware can offer several advantages, including favorable tax structures and business-friendly laws. Non-citizens should also be aware of the immigration and visa requirements for starting a business in the US.

To get a US business account as a non-citizen, you will need to provide certain documentation, such as your TIN or EIN, proof of identification, and proof of residency. It’s important to research and compare various banks and their requirements, as some may have more strict requirements than others.
Additionally, consider working with a financial advisor or accountant to ensure that your business finances are in order and compliant with US laws and regulations.
Starting a business in the US as a non-citizen can be a challenging but rewarding experience. With careful planning and compliance, non-citizens can successfully start and grow their businesses in the US.

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