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Specialty · Foreign-owned LLC taxation
Form 5472 Filing for Foreign-Owned U.S. LLCs
If you live outside the U.S. and own a single-member LLC in Wyoming, Delaware, New Mexico or any other state, the IRS expects Form 5472 with a pro forma Form 1120 every year, even if the LLC earned nothing in the U.S. We prepare it, file it and keep you clear of the $25,000 penalty.
What is Form 5472?
An information return the IRS takes seriously
Form 5472 reports transactions between a U.S. company and its foreign owner. Since tax years beginning in 2017, a U.S. single-member LLC owned by a foreign person is treated as a corporation for this reporting, so it must file Form 5472 attached to a pro forma Form 1120.
The pro forma 1120 is not a full corporate tax return. It carries the LLC's identifying information so the IRS can process the Form 5472. Most LLCs that file it owe no U.S. income tax on that return, but missing it is expensive.
Even no income counts. A filing is usually required whenever money moved between you and your LLC during the year, and paying your LLC's formation or state fees from personal funds generally counts.
Form 5472Foreign-owned U.S. disregarded entity
- Who files
- U.S. single-member LLC owned by a non-U.S. person
- Filed with
- Pro forma Form 1120 (identifying information only)
- Reports
- Contributions, distributions, loans and payments between the LLC and its owner or related parties
- Due date
- April 15 for calendar-year LLCs; six-month extension with Form 7004
- How it's filed
- By fax or mail as the IRS instructions require; it cannot be e-filed
$25,000 penalty per form for filing late, incomplete or not at all.
Do you need to file?
You probably do if all of these are true
You own a single-member U.S. LLC
The LLC has one owner and is treated as a disregarded entity for U.S. tax purposes.
Money moved during the year
You put money in, took money out, lent money, or paid LLC costs yourself. These are reportable transactions.
Your LLC has two or more owners? It is usually a partnership and files Form 1065 instead. We prepare those too. See business returns →
Reportable transactions
What goes on the form
Form 5472 lists every reportable transaction between the LLC and its foreign owner or other related parties during the year. We go through your bank statements and records with you to make sure nothing is missed, because an incomplete form carries the same penalty as a missing one.
- Capital contributions: money you put into the LLC, including to open it.
- Distributions: money you took out of the LLC for yourself.
- Loans between you and the LLC, in either direction.
- Expenses you paid personally for the LLC, such as formation, state or registered agent fees.
- Payments for services, rent or royalties between the LLC and related parties.
- Sales or purchases of goods or property with related parties.
The penalty
Why $25,000 is not a typo
The IRS can charge a $25,000 penalty for each Form 5472 that is filed late, filed incomplete or not filed at all. If the IRS sends a notice and the form is still not filed within 90 days, an additional $25,000 can apply for each 30-day period after that.
Many founders are told by formation services that a foreign-owned LLC has "nothing to file." That advice causes most of the late filings we see.
Missed prior years?
Get current before the IRS writes
If you formed your LLC in an earlier year and never filed, we prepare the missing years and, where it applies, a statement explaining the reason for the delay. Acting before the IRS contacts you usually gives you more options.
Beyond Form 5472
Does your LLC owe U.S. income tax?
Form 5472 is an information return. Whether you also owe U.S. income tax depends on what your business actually does in the U.S.
Effectively connected income
If your LLC has a U.S. trade or business, such as U.S. employees, an office or inventory held in the U.S., its income may be taxable and you may need to file Form 1040-NR. We review your activity and tell you where you stand.
State filings
Most states require an annual report and some charge an annual fee or franchise tax. These are separate from your IRS filings, and we add them to your tax calendar.
EIN & ITIN
Your LLC needs an EIN to file. Owners without an SSN can still get one. An ITIN is only needed in some cases, for example when you must file a personal U.S. return.
How it works
Filed in four steps
Free call
We confirm whether you need to file and for which years.
Written quote
A clear quote based on the years to file and how many LLCs you own.
Send records
Bank statements and a short questionnaire about the year's transactions.
Prepare & file
You approve the forms, we send them to the IRS as required and give you proof of submission.
Pricing
Starting at $249, quoted on your scope
The number of transactions does not change the price. The final fee depends on whether earlier years are unfiled, whether you own more than one LLC, and whether the LLC has U.S. income that needs review. Every quote is confirmed in writing before work begins.
Prior years unfiledMultiple LLCsU.S. income (ECI)
Single-member LLC (5472 + pro forma 1120)$249+
C corporation (1120 + 5472)$649+
Each missed prior year (LLC)$299+
Final price depends on complexity and scope.
Get a Custom Quote →
Client review
From a foreign owner
Foreign-owned tax filing
An expert in U.S. tax matters.
I have been using Shape Accounting's tax filing services for three years. They are really helpful and guide you through every matter related to U.S. taxation. I highly recommend them!
FAQ
Form 5472 questions
Not sure about your situation? Send us your LLC's formation date and state, and we will tell you what is due.
My LLC had no income. Do I still need to file Form 5472?
Usually yes. The requirement depends on reportable transactions, not income. If you put money into the LLC, took money out or paid its fees yourself during the year, a Form 5472 with a pro forma Form 1120 is generally required.
When is Form 5472 due?
For a calendar-year LLC, it is due on April 15 of the year after the tax year ends. Filing Form 7004 extends the deadline by six months, to October 15. If a deadline falls on a weekend or holiday, it moves to the next business day.
Can Form 5472 be e-filed?
No. A pro forma Form 1120 with Form 5472 for a foreign-owned single-member LLC must be sent to the IRS by fax or mail, as the form instructions describe. We prepare the package, send it and give you proof of submission.
What is the penalty for not filing Form 5472?
The penalty is $25,000 for each form that is late, incomplete or not filed. If the form is still not filed within 90 days of an IRS notice, an additional $25,000 can apply for each 30-day period after that.
I missed previous years. What should I do?
File the missing years as soon as possible. We prepare each missing year and, where it applies, a statement explaining the reason for the delay. Filing before the IRS contacts you usually gives you more options.
Do I need an SSN or ITIN to file?
No. The LLC files using its EIN, which non-resident owners can get without an SSN or ITIN. An ITIN is only needed in some cases, for example if you must file a personal Form 1040-NR.
Do foreign-owned C corporations file Form 5472 too?
Yes. A U.S. corporation that is at least 25% owned by a foreign person generally attaches Form 5472 to its full Form 1120 corporate tax return. Because the corporation also files a complete income tax return, pricing for a C corporation starts at $649.
Does Form 5472 apply to multi-member LLCs?
A multi-member LLC is usually taxed as a partnership and files Form 1065 instead, with different reporting for foreign partners. We prepare partnership returns as well.
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