QUESTION: I would like to understand if there are any penalties for a foreign-owned U.S. single-member LLC due to delays in filing the Proforma 1120 and Form 5472.
EXPERTS ANSWER:
Yes, significant penalties are indeed associated with the late filing of Proforma 1120 and Form 5472. These penalties can amount to $25,000 for each instance of late filing, incorrect filing, or non-filing. The application of these penalties, however, is subject to the discretion of the IRS, which assesses each case based on specific circumstances.
It’s important to note that while my experience since 2017 involves submitting these forms late without penalty to my clients, this outcome is not guaranteed for all filers. The IRS evaluates each situation individually, and their decision to impose penalties can vary based on factors such as the length of the delay and the reasons provided for non-compliance.
For foreign-owned U.S. LLCs, ensuring timely and correct filing of these forms is crucial to avoid potential penalties. If you’re concerned about your filing status or have questions about how these penalties might apply to your situation, I highly recommend consulting with a CPA who specializes in U.S. tax law for international business owners.
For expert guidance and personalized advice on navigating these regulations, consider exploring our premium consultation services. Our experienced CPAs can provide you with the detailed support and strategic planning needed to manage your tax obligations effectively.
