Accounting services for foreign-owned US companies cover the ordinary work every business needs, such as bookkeeping and payroll, plus a set of filings that exist only because the owner lives outside the United States. The biggest of these is Form 5472, which a foreign-owned single-member LLC must file with a pro forma Form 1120 for any year with a reportable owner transaction, even when it owes no tax, and which carries a $25,000 penalty for each missed form.
This guide is written for founders abroad who own a US LLC or corporation, and for the CPA firms that serve them. It explains which accounting services for foreign-owned US companies matter most in 2026: getting an EIN without a Social Security number, keeping books that support Form 5472, paying profits out to a foreign owner, keeping a state registered agent, and where beneficial ownership reporting stands after FinCEN's 2025 and 2026 rules.
A US company with a foreign owner keeps the same general ledger as any other company. Sales, expenses, bank reconciliations and month-end close all work the same way. The difference sits in three places.
First, the owner relationship is itself a reporting item. Money the owner puts in, takes out, lends or spends on the company's behalf has to be tracked separately, because the IRS asks for it by category on Form 5472.
Second, the owner usually has no SSN, which changes how the company gets its tax ID and how the owner files any personal US return.
Third, cross-border payments bring withholding and pricing rules. A dividend, royalty or service fee paid to a foreign parent is treated differently from the same payment to a US vendor.
A provider handling this work typically combines routine bookkeeping with year-end preparation of the federal information returns, plus a calendar of state filings. For a broader view of how outsourced engagements are usually scoped, see our guide to what to expect from outsourced accounting services.
Most foreign founders choose between two structures.
A single-member LLC with one foreign owner is a disregarded entity for income tax by default. It does not pay federal income tax itself, and its income only becomes taxable to the owner if the owner has US-source income or a US trade or business. It still has information reporting duties, covered below.
A C corporation, or an LLC that elects corporate treatment, pays federal tax on its own profits. Section 11(b) of the Internal Revenue Code states, "The amount of the tax imposed by subsection (a) shall be 21 percent of taxable income." Profits paid out to a foreign shareholder can then face a second layer of tax through withholding.
An LLC can change its default classification by filing an election, which is explained in our article on Form 8832 and the entity classification election. A foreign company that operates in the US directly through a branch, without a US subsidiary, files a different return covered in our guide to Form 1120-F for foreign corporations.
Every US entity needs an Employer Identification Number to open a bank account, file returns and work with payment processors. The IRS online application is closed to most foreign founders. The Form SS-4 instructions say the owner or principal officer "must have a valid taxpayer identification number (SSN, EIN, or ITIN) in order to use the online application." For applicants with no US office or residence, the same instructions give a phone route: "you may call 267-941-1099 (not a toll-free number), 6:00 a.m. to 11:00 p.m. (Eastern time), Monday through Friday." The responsible party named on the form is "the person who ultimately owns or controls the entity or who exercises ultimate effective control over the entity."
The owner may separately need an Individual Taxpayer Identification Number. The IRS ITIN page states, "You need an ITIN if you have a federal tax purpose and you're not eligible for an SSN." Common triggers include filing a personal Form 1040-NR or claiming a treaty benefit. An ITIN does not give permission to work in the US. The application process is covered in our article on Form W-7 and the ITIN application, and the personal return is explained in our guide to Form 1040-NR for nonresident aliens.
The year-end information return is the filing that most often catches foreign-owned LLCs off guard. The IRS Instructions for Form 5472 treat the LLC as a corporation for this limited purpose: "a foreign-owned U.S. DE is treated as an entity separate from its owner and classified as a corporation." As a result, the LLC must attach Form 5472 to "a pro forma Form 1120" for any year with a reportable transaction, even with no income. A first-year LLC almost always has one, because the opening capital contribution counts.
From the accounting side, the points to manage are:
This section covers only what the books need to support. Our Form 5472 filing guide for foreign-owned US businesses walks through the form itself line by line.
An owner living in India forms a Delaware LLC in 2026 to sell software to US customers. During the year, these owner transactions pass through the books:
| Transaction with the foreign owner | Amount | Where it goes in the ledger |
|---|---|---|
| Capital contributed to open the bank account | $40,000 | Owner contributions (equity) |
| Formation and registered agent fees the owner paid personally | $3,500 | Expense, credited to owner contributions |
| Short-term loan from the owner | $10,000 | Loan from owner (liability) |
| Cash distributed to the owner in December | $25,000 | Owner distributions (equity) |
| Total owner transactions in the year | $78,500 |
If the bookkeeper had lumped all of these into one "owner" account, the year-end return would need a reconstruction of bank statements. Keeping separate accounts for contributions, distributions and owner loans from the first month means the Form 5472 figures come straight from the trial balance. Whether this LLC also owes US income tax depends on whether its activities amount to a US trade or business, which is a separate analysis.
When a US C corporation pays dividends to a foreign shareholder, withholding applies. The IRS NRA withholding page states: "Most types of U.S. source income received by a foreign person are subject to U.S. tax of 30%." It adds that a reduced rate may apply where a Code section allows it or "there is a tax treaty between the foreign person's country of residence and the United States."
Here is how the two layers combine at the statutory rates, before any treaty reduction:
| Step | Amount |
|---|---|
| Taxable income of the US corporation | $200,000 |
| Federal corporate tax at 21% | $42,000 |
| After-tax profit paid as a dividend | $158,000 |
| Withholding at 30% on the dividend | $47,400 |
| Combined federal tax | $89,400 (44.7% of pre-tax income) |
A treaty rate can cut the withholding line substantially, which is why the foreign parent's documentation matters. Foreign payees certify treaty status on Form W-8BEN-E, explained in our guide to Form W-8BEN-E and US tax withholding. State income tax is extra and varies by state.
Payments between the US company and a related foreign company for services, licenses or goods also need arm's-length pricing and supporting documentation. Our article on the five OECD transfer pricing methods covers how those prices are tested.
Each state where the company is formed or registered to do business requires a registered agent with a physical address in that state to accept legal papers. In Delaware, the LLC statute requires the certificate of formation to list "the registered office and the name and address of the registered agent for service of process required to be maintained by § 18-104 of this title," per the Delaware Code, Title 6, Chapter 18. Most foreign founders use a commercial registered agent, and the annual fee and the state's own annual report or franchise tax belong on the compliance calendar.
Selling into other states can also create sales tax registration duties and, with remote employees, payroll registrations. These are tracked state by state.
The Corporate Transparency Act originally required most small US companies to report their owners to FinCEN. That changed in 2025. According to FinCEN's BOI page, the March 2025 interim final rule exempted "all entities created in the United States" and their beneficial owners. FinCEN then issued a final rule on August 11, 2026 making those exemptions permanent, effective August 14, 2026.
For a foreign founder this means a Delaware or Wyoming LLC formed in the US does not file a BOI report. A company formed under the law of another country that registers to do business in a US state may still have to file, generally within 30 calendar days after receiving notice that its registration is effective, unless an exemption applies. For the accountant, this is a calendar item to confirm at formation. Our page on BOI reporting in 2026 and who must still file covers the remaining filers and the filing process in detail.
| Task | Timing | Applies to |
|---|---|---|
| EIN application by phone, fax or mail | At formation | All US entities |
| Separate owner contribution, distribution and loan accounts | Monthly | Foreign-owned LLCs |
| Bank and payment processor reconciliations | Monthly | All entities |
| Form 5472 with pro forma Form 1120, or Form 7004 extension | By the return's due date | Foreign-owned single-member LLCs |
| Form 1120 with Form 5472 | By the return's due date | Foreign-owned C corporations |
| Withholding on payments to foreign persons | When paid | Companies paying dividends, royalties or fees abroad |
| State annual report and registered agent renewal | Per state schedule | All entities |
| BOI report, if required | Within 30 days of notice of US registration | Foreign-formed companies registered in a US state |
Software choice matters less than account structure. Teams running more than one entity, for example a US subsidiary alongside the foreign parent, may find our comparison of QuickBooks and Xero for multi-entity accounting useful.
Does a foreign-owned LLC with no US income need to file anything? Yes, in most cases. A foreign-owned single-member LLC is treated as a corporation for Form 5472 purposes and must file Form 5472 with a pro forma Form 1120 each year it has reportable transactions with its owner, and the IRS assesses a $25,000 penalty for a missed form.
Can a foreign owner get an EIN online? Usually not. The IRS online tool requires the responsible party to have an SSN or ITIN. Applicants whose business is based outside the US can apply by phone at 267-941-1099, or by fax or mail.
What should a foreign founder look for in an accounting provider? Experience with nonresident owners matters more than software. The provider should set up separate owner accounts from the first month, track year-end information return deadlines, document related-party pricing and keep a calendar of state filings for each entity.
Does the foreign owner need an ITIN? Only if the owner has a federal tax purpose, such as filing a personal Form 1040-NR or claiming a treaty benefit. The company itself uses an EIN.
How often should a foreign-owned company's books be closed? Monthly is a common practice. A monthly close with bank and payment processor reconciliations keeps owner transactions classified as they happen, so the year-end returns can be prepared from the trial balance.
Madras Accountancy supports US CPA firms and their clients with bookkeeping, tax preparation and year-end compliance work, including the owner-transaction records that foreign-owned companies need. To discuss a client's setup, contact our team.
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