{"id":234,"date":"2020-12-24T22:00:51","date_gmt":"2020-12-24T22:00:51","guid":{"rendered":"https:\/\/ogtax.wpengine.com\/?p=156"},"modified":"2023-02-24T07:24:08","modified_gmt":"2023-02-24T07:24:08","slug":"starting-a-business-partnership-with-a-foreign-national-living-outside-the-united-states","status":"publish","type":"post","link":"https:\/\/oandgaccounting.com\/staging\/starting-a-business-partnership-with-a-foreign-national-living-outside-the-united-states\/","title":{"rendered":"Starting a Business Partnership with a Foreign National Living Outside the United States"},"content":{"rendered":"<p><strong>Question:<\/strong> I am in a process of starting a partnership\/LLC. One of the potential partners is a nonresident without a green card (in the process of getting one). Can we form an LLC prior to the non-resident obtaining a green card?<\/p>\n<p><strong>Answer:<\/strong> Generally, there is no restriction in state\u00a0<a href=\"http:\/\/www.irs.gov\/publications\/p3402\/ar02.html\" target=\"_blank\" rel=\"noopener noreferrer\">LLC<\/a>\u00a0laws that limit who can form a limited liability company or who can own a membership interest in an LLC. A\u00a0<a href=\"http:\/\/www.irs.gov\/Individuals\/International-Taxpayers\/Determining-Alien-Tax-Status\" target=\"_blank\" rel=\"noopener noreferrer\">non-resident<\/a>\u00a0of the U.S. is free to form an LLC under the laws of any state he chooses. Similarly, an entity based outside the U.S. may form and own a limited liability company in the United States.<\/p>\n<p><!--===============google ad=================--><\/p>\n<p><script async src=\"https:\/\/pagead2.googlesyndication.com\/pagead\/js\/adsbygoogle.js?client=ca-pub-3039986354638252\"\n     crossorigin=\"anonymous\"><\/script><br \/>\n<ins class=\"adsbygoogle\"\n     style=\"display:block; text-align:center;\"\n     data-ad-layout=\"in-article\"\n     data-ad-format=\"fluid\"\n     data-ad-client=\"ca-pub-3039986354638252\"\n     data-ad-slot=\"7838143718\"><\/ins><br \/>\n<script>\n     (adsbygoogle = window.adsbygoogle || []).push({});\n<\/script><\/p>\n<p><!--===============google ad=================--><\/p>\n<p>Further, there is no requirement that the activities of the LLC be managed from within the United States or even that its activities be conducted within the United States. A\u00a0<a href=\"http:\/\/www.irs.gov\/Individuals\/International-Taxpayers\/Classification-of-Taxpayers-for-U.S.-Tax-Purposes\" target=\"_blank\" rel=\"noopener noreferrer\">foreign individual<\/a>\u00a0can form and operate his LLC from wherever he happens to be.<\/p>\n<p>Although a non-resident of the U.S. can form and own an LLC generally, there are some restrictions on ownership of certain entities under various state laws that may restrict ownership for reasons other than citizenship or residency. For example, state law may require that all members of an LLC engaging in the practice of medicine be licensed physicians in that state or all members of an LLC engaging in the practice of law be licensed attorneys.<\/p>\n<p>If there is one drawback to forming an LLC with a\u00a0 non-US resident, it is that you can\u2019t elect for your LLC to be treated as an S corporation to reduce your tax burden. This is a feature that US citizens and <a href=\"https:\/\/www.irs.gov\/individuals\/international-taxpayers\/resident-aliens\" rel=\"noopener noreferrer\" target=\"_blank\">Residents Aliens<\/a> or <a href=\"https:\/\/www.irs.gov\/individuals\/international-taxpayers\/classification-of-taxpayers-for-us-tax-purposes\" rel=\"noopener noreferrer\" target=\"_blank\">U.S Persons for tax purposes<\/a> can take advantage of, BUT <a href=\"https:\/\/www.irs.gov\/individuals\/international-taxpayers\/nonresident-aliens\" rel=\"noopener noreferrer\" target=\"_blank\">Non-Resident Aliens<\/a> do not qualify for\u00a0<a href=\"http:\/\/www.irs.gov\/Businesses\/Small-Businesses-&amp;-Self-Employed\/S-Corporations\" target=\"_blank\" rel=\"noopener noreferrer\">S corp<\/a> ownership -See <a href=\"https:\/\/www.law.cornell.edu\/uscode\/text\/26\/1361\" rel=\"noopener noreferrer\" target=\"_blank\">Section 1361(b)(1)(C)<\/a>\n               <\/ol>\n<p>If you&#8217;re in need of professional bookkeeping services, we recommend visiting our subsidiary, <a href=\"https:\/\/ursaservicesllc.com\/\" rel=\"noopener\" target=\"_blank\">URSA Services LLC<\/a>. They specialize in keeping your finances in order so you can focus on growing your business. Don&#8217;t worry, we&#8217;ll still be here to handle all your tax needs. <a href=\"https:\/\/ursaservicesllc.com\/\">Visit URSA Services LLC<\/a> today to learn more!!<\/p>\n<p><!--===============google ad=================--><\/p>\n<p><script async src=\"https:\/\/pagead2.googlesyndication.com\/pagead\/js\/adsbygoogle.js?client=ca-pub-3039986354638252\"\n     crossorigin=\"anonymous\"><\/script><br \/>\n<ins class=\"adsbygoogle\"\n     style=\"display:block; text-align:center;\"\n     data-ad-layout=\"in-article\"\n     data-ad-format=\"fluid\"\n     data-ad-client=\"ca-pub-3039986354638252\"\n     data-ad-slot=\"7838143718\"><\/ins><br \/>\n<script>\n     (adsbygoogle = window.adsbygoogle || []).push({});\n<\/script><\/p>\n<p><!--===============google ad=================--><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Question: I am in a process of starting a partnership\/LLC. One of the potential partners is a nonresident without a green card (in the process of getting one). Can we form an LLC prior to the non-resident obtaining a green card?<\/p>\n","protected":false},"author":1,"featured_media":503,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"om_disable_all_campaigns":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[1],"tags":[],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v22.6 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Starting a Business Partnership with a Foreign National Living Outside the United States - O&amp;G Tax and Accounting<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/oandgaccounting.com\/staging\/starting-a-business-partnership-with-a-foreign-national-living-outside-the-united-states\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Starting a Business Partnership with a Foreign National Living Outside the United States - O&amp;G Tax and Accounting\" \/>\n<meta property=\"og:description\" content=\"Question: I am in a process of starting a partnership\/LLC. 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