You don’t need to be an American citizen to open a business in the USA. Anyone can set up a business/company in the USA, but registering a business as a foreigner is a bit harder compared to USA citizen. As a foreigner, you need to go through several procedures than USA citizen and need to pay more tax if you decide to take your income out of the United States of America. However, the entire process of registering a company in the USA are described below: –
Type of Business Structure In USA
Limited Liability Corporations:
This is one of the most popular business structures in the United States. You can start an LLC without having citizenship. The registration process of Limited Liability Corporation is the same for both the foreigner nation and USA citizen.
Sole Proprietorship:
This is a type of business that is owned and controlled by one person. In a sole proprietorship business, the owner is responsible for all the liabilities. Some features of sole proprietorship are — inexpensive to form compared to other business structure, low tax, there no formalities except basic bookkeeping, etc. Depending on the type of Sole Proprietorship the licensing process may vary.
Joint Venture:
This type of partnership is time-based where two or more individuals can work together for a particular project or to extend the time. Upon completion, the partnership is terminated. If individuals want to continue working together afterward, they will register as joint partners.
Business corporation:
This is a legal entity created by an individual (s) under the laws of the State to perform specific types of business or transactions. From a functional point of view, there are two types of corporations – a business corporation and a non-profit corporation.
A business corporation is formed to pursue a business in the broadest sense of the word, and these deals are profitable. The non-profit corporation is formed to develop a specific goal of an organization that is not created for profit. In general, this includes charitable, charitable and educational organizations.
Process of Company Name Registration
The company name registration in the USA is pretty straight forward. The name of the company can be registered via trademark office online portal www.uspto.gov. However, before you complete your company name registration, you must check the name availability of the company. This is necessary because other company may already be using the same name. As a result, your proposed will be rejected for registration.
- Online registration of the trade name can cost between 375 $ to 330$ maximum.
- If everything is alright, it takes about just 90 minutes to complete the name registration.
- The can be rejected for registration if it violates public ethics.
Acquire your federal tax ID
The IRS uses the Employee Identification Number (EIN) to identify corporations, trusts, and properties that have to pay taxes. Almost every business in the USA needs to obtain employer identification to operate their business legally in the country. The FTIN is necessary to open a corporate bank account in the USA. You can apply for FTIN through an online application. If everything provided in the application meets the requirement, you will receive an EIN via email. A business needs federal Tax ID if they do the followings—
- To operate a partnership or corporation.
- Pays the employees
- File tax returns for work, excise or alcohol, tobacco and firearms
- Income tax other than remuneration to be paid to a non-resident foreigner
- Uses a Keogh plan (deferred tax plan)
The different process of business registration includes– Registering business with state revenue agency, acquire necessary business license and permits and opening bank account.
Q: How long does company incorporation USA take?
- In the USA it takes a maximum of 30 days for company incorporation. However, the processing time may vary between the states. For foreign citizen, it usually takes more time to register a company than locals.
Q: Can foreign business own USA company?
- If you decide to set up a Limited Liability Corporation than Yes. It is done by appointing your own foreign company as a managing member instead of an individual.
Q: How long does it take to register a company name?
- Its take 90 minutes to register a company name in the USA.
