7 Common Mistakes Non-US Founders Make When Forming a US LLC

1. Choosing a state on hearsay

Each state has different fees and obligations. Compare multi-year total cost and consider where you actually operate rather than following the crowd.

2. Looking only at the first-year price

Some providers advertise a very low first-year price but charge a lot in later years or for add-on packages. Ask clearly about the Registered Agent renewal fee.

3. Missing IRS reporting

LLCs owned by foreign persons usually still have to file annual reports with the IRS even with no revenue. Penalties for missing them can be very large. Ask an accountant from year one.

4. Mixing company money with personal money

Using the LLC account for personal spending weakens limited-liability protection and makes reconciling the books hard.

5. Having no Operating Agreement

Not every state requires one, but banks usually ask for it and it is the reference point if members disagree.

6. Forgetting the annual report deadline

Being late can lead to penalties and administrative dissolution. Use a calendar or a reminder tool.

7. Ignoring tax and foreign-exchange rules in your home country

A US LLC doesn't replace your obligations at home. Income you receive and money you transfer must follow local rules. Talk to a professional before you start.

This article is general information, not legal or tax advice. Rules and fees change by state and over time — check the official state/IRS pages and consult a professional before you decide.