U.S. Enterprises and Financial Institutions Holding Bank Accounts for Both Domestic and International Customers
In the bustling world of global business, non-US citizens now have the opportunity to incorporate foreign companies in Delaware or Nevada, two states known for their favourable laws and tax frameworks.
While US taxpayers are still subject to taxes on their worldwide personal income, the profits of Hong Kong companies remain tax-free for transactions outside the country. This, coupled with the benefits of incorporating in Delaware or Nevada, makes these states an attractive choice for foreign business owners.
The process of incorporating a foreign company in these states involves several key steps. First, you need to select the state—Delaware or Nevada—and appoint a registered agent with a physical address in that state. Next, you'll need to file formation documents, such as the Certificate of Incorporation or Articles of Organization, and pay applicable fees. For foreign companies, additional documents like a Certificate of Good Standing from the home jurisdiction are required.
In Delaware, foreign companies must also apply for a Certificate of Authorization to conduct business in Delaware. This involves submitting formation documentation, a registered agent's information, and a Certificate of Good Standing from its original jurisdiction. Nevada has similar procedures, though the details may vary slightly by state.
Once the incorporation is complete, obtaining an Employer Identification Number (EIN) from the Internal Revenue Service (IRS) is necessary to handle taxes and open a US bank account. Non-US citizens do not need a Social Security Number to apply for an EIN; the IRS Form SS-4 can be used directly.
To open a US bank account, non-US citizens generally need company formation documents, an EIN confirmation letter from the IRS, the LLC operating agreement or bylaws, two forms of identification (such as a foreign passport and driver's license), and proof of a US business address. Some banks require in-person visits for account opening, but fintech banks may allow remote setups. It’s crucial to check with the bank beforehand for exact documentation requirements.
In conclusion, non-US citizens can incorporate foreign companies in Delaware or Nevada by filing the appropriate documents with a registered agent, securing an EIN from the IRS, and then opening a US business bank account with the required paperwork and identification. Many service providers assist with the entire process, including EIN application and bank setup for foreign owners.
It's important to note that incorporating in the US, such as in Delaware or Nevada, is a relatively easy process for foreigners, without the requirement of being a US citizen or resident. However, ongoing compliance, such as annual reports and state taxes, must be observed.
References:
- Investopedia
- Nevada Secretary of State
- Delaware Division of Corporations
- Incfile
- IRS
In this process, foreign business owners might find Delaware or Nevada appealing due to their favorable laws and tax frameworks when incorporating their companies. To manage taxes and open a US bank account, an Employer Identification Number (EIN) from the Internal Revenue Service (IRS) is essential for foreign companies. To simplify the entire process, including EIN application and bank setup, many service providers are available for foreign owners.
Managing ongoing compliance, such as annual reports and state taxes, is crucial for foreign companies incorporated in the US, even though the process of incorporating is relatively easy for non-US citizens in states like Delaware or Nevada.
