A foreign LLC refers to an LLC that conducts business in a state other than the one where it was originally registered. This requires registering in those additional states as a foreign limited liability company by filing paperwork with the Secretary of State. The term “foreign” simply denotes that the LLC is registered outside its home state, and has nothing to do with whether owners are US residents.
Registration Requirements
A foreign LLC must register with a state if it has physical business assets or activities there, such as:
- A warehouse, store, office or manufacturing facility
- Paid employees
- Business meetings
- Business bank accounts
Registering provides benefits like liability protection but may require paying state fees and taxes.
To register a foreign LLC in another state, documentation like a Certificate of Good Standing from the home state is required. Specific business activities like purely online operations may not trigger foreign LLC registration requirements.
The key reasons to register a foreign LLC are to legally transact business and protect personal assets in additional states beyond the LLC’s home jurisdiction.
Foreign-owned LLCs
A foreign-owned LLC is an entity in which a foreign entity owns an interest, either directly or indirectly. This can include both single-owner and multi-member LLCs.
Forming a Foreign-owned LLC
Forming a foreign-owned LLC can provide limited liability protection for its owners and offer potential tax benefits. It’s important to comply with any restrictions imposed by federal and state laws, such as obtaining the necessary visas or permits for active management within the United States.
To form a foreign-owned LLC in the United States, you need to:
- Register with the Secretary of State or other relevant state authorities.
- Provide information from the Articles of Organization and a copy of the official LLC document from the state.
- Determine if registration as a foreign LLC is required in any additional state where you are "doing business."
The owner of a Single-Member LLC (SMLLC) must apply for an Employer Identification Number (EIN) by preparing and filing a form called “SS4.” The EIN application must be signed by the IRS-defined “Responsible Party.”
While there are no restrictions on foreign ownership of a company in the United States, except for S-Corporations, it is not necessary to be a U.S. citizen or have a green card to own an LLC or corporation in the country.