If you have doubts about how to start a business in the U. S. when you are a foreigner, you should know that you can invest and do business without starting a U. S. company.
The Internal Revenue Service can bill you as a foreign company the national tax. However, it is easier to open a subsidiary because when the IRS sends documentation overseas, it does so by regular mail, which can take months.
Step by step to figure out how to start a business in the United States as a foreigner
Follow this step by step and you’ll answer your questions about how to start a business in the United States when you’re a foreigner:
Step 1: Choose the company structure.
But foreign citizens generally choose a C corporation because expansion is possible by offering limited stock and they are more attractive to investors, even though profits must be taxed twice.
Corporate stockholders have advantages because they qualify for a lower dividend rate and if the company does not own real estate, the parent company pays capital gains by selling to the U. S. affiliate.
While the payment is double, tax planners use pensions, wages, and other expenses to reduce corporate income while eliminating some of the double taxation.
However, depending on the case and tax laws, the limited partnership is the best option as a commercial structure.
In the case of a limited partnership, partners without management control have limited liability and in terms of profits are transferred to members, who pay income tax on the individual tax return.
Step 2: Choose the state for your company registration.
Your company’s business determines its location. In fact, if a state is dominant in the market, it’s a good idea to incorporate your company in that place.
Keep in mind that there is no way you can avoid the obligations of doing business in California. Delaware and Nevada are two low-load states. But if your business doesn’t focus on a particular state, Delaware and then Nevada is the most advisable, because of the flexibility of corporate law that offers directors and shareholders protection, and that doesn’t require you to have a bank account or a physical address.
If you decide to go to Delaware, you can consult their corporate law website.
Step 3: Register your business.
Depending on the state where your business operates, the requirements and forms will vary, but are usually as follows:
Business managers must choose a unique name for the company.
You must choose a registered agent to receive legal documents from the company, for example, it may be a company with a physical address in the state that will function as an agent, but it depends on each state.
The company must complete the certificate of incorporation with corporate name identification, registered agent’s address, the nominal value of the shares authorized to be issued by the corporation, the total amount and the name and postal address of the incorporated party. The fees start from 89 dollars and increase according to the number of shares issued and the capital raising.
When you incorporated the business you will file a report and pay the franchise tax which has an annual cost of $175 while the report cost is $50.
While you can find the online help that provides services for the formation of your company with separate rates, spend hundreds of dollars while the presentation of documentation is simple and the secretary of your state can find information online with the help you need to submit documentation.
Step 4: Get the employer identification number.
You need it only if you hire workers and if you don’t hire if you will need it to open a bank account, pay taxes and obtain a business license.
You can apply online unless you have obtained the taxpayer identification number separately, then you will have to process it by mail.
Keep in mind also that foreigners with investments or business in the United States generally must establish a domestic corporation and start a business in the United States is not difficult, but it is best to consult with tax law experts before starting your business.
What businesses can I put in the United States
Follow these steps to set up your business in the United States, as the local Small Business Administration can help you.
Cleaning services for offices, houses, buildings, and others
The house cleaning service is the first option that you can evaluate as a profitable business and has an average cost of $150 dollars considering that you will meditate on your business cards, brooms, vacuum cleaners, detergent, ceibos and rags to start.
The internet sale is also a good business because with your computer you will be able to start working and has an average cost of 500 dollars in addition to the products you want to sell although you can take advantage of drop-shipping and not even need to buy products for sale.
The planter is another option if you like to prune your neighborhood garden you can offer your services because it is a profitable type of business that has an average cost of 450 dollars including business cards, scissors, shovels, rakes, edgers and lawn mowers and you can charge for pruning about 25 dollars.
Pool cleaning service
Swimming pool service is also a profitable business, with a cost of $400 you’ll include business cards, hose, brushes, chemical products and services in warm weather areas where most homes have swimming pools that need maintenance every week.
How to open a branch in the United States
If you want to open a branch office in the United States, you first need an L visa and corporations, partnerships and limited liability companies are admitted.
Types of companies in the USA
The types of companies in use are:
Sole Proprietorship: The company through which the company and owner are considered as one. Depending on each state it is easy to create and depending on the type of business it is likely that you will need a license to collect sales taxes and another license to operate. Although it has advantages, the disadvantage is that any problem can lead to losses because the owner must be liable for debts with his personal capital.
Limited Liability Partnership: It may consist of two or more persons who will be members and these are not responsible for the problems that could cause the rest, but not all states admit it.
General partnership: It is also made up of two or more members. It’s a cheap structure to form. A license is usually required to start operating the business, but it has the disadvantage that any of the partners have the right to sign a contract, can execute the other partners and each one is liable for the debts that the partnership may incur with its own assets and for the damages caused by one of the partners in the exercise of the activity.
Limited partnership: It is made up of two or more partners with limited liability and except for those who occupy the management, the rest of the partners are not obliged to take responsibility with their patrimony for the debts caused by the partnership. However, this is an expensive structure.
S Corporation: In this case, there is no double appraisal, the partners have limited liability. It is a structure whose formation is expensive and complex but with advantages similar to those of a LCC.
Corporation C: Although in this case, the partners do not take charge of the debts generated by the business is an expensive structure at the time of forming it with a double taxation and the dividends distributed among the partners are declared by each one of them filling out the tax form and a percentage is paid on the profits generated.
How to open a business in the United States being Mexican
If you are Mexican and want to know how to start a business in the U. S. when you are a foreigner, it is not so difficult and there are no requirements.
In principle, with the capital necessary to start your business from scratch, it is essential that you have the E-2 visa with you. As an investor, you can open it by taking your family and employees to form a subsidiary and work and live temporarily, but if you have a B-1 visa, you can create your company with a limited liability partnership structure.