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What taxes does a non-resident's U.S. LLC pay?

By Katiuska Bustillos, founder and tax preparer Reviewed by Katiuska Bustillos Published: October 1, 2026 Updated: October 1, 2026

Applies to returns for tax year 2025 (filed in 2026) and, unless the rules change, 2026. Based on Pub. 519 and the 2025 Instructions for Form 1040-NR.

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Short answer

A single-member LLC does not pay federal income tax on its own: the IRS treats it as a disregarded entity and its income is attributed to you. As a non-resident, the U.S. only taxes your income effectively connected with a U.S. trade or business (ECI) and certain U.S.-source income; if you provide services from your home country, without working in the U.S. or having an office or agents there, there is usually no ECI and no federal income tax. The LLC still files Form 5472 with a pro forma 1120 every year, and if there is ECI you file Form 1040-NR (due June 15 if you had no wages subject to withholding). State fees and whatever you owe in your home country are separate.

Not sure whether your LLC has to file Form 5472? Take the free test (1 minute) →

Your LLC doesn't pay the tax: it flows to you

For the IRS, a U.S. LLC with one owner is, unless it elects otherwise, a disregarded entity: it is not a separate taxpayer, and its activity is reflected on its owner's return. So the useful question is what taxes you, as a non-resident, pay on what your LLC earns.

This guide assumes you are not a U.S. tax resident: not a citizen, no green card, and you don't meet the substantial presence test. If your LLC elected to be taxed as a corporation (Form 8832), different rules apply; if it has several members, jump to Multi-member LLCs.

What the U.S. taxes a non-resident on: ECI and FDAP

Under IRS Publication 519, a non-resident is taxed in the U.S. on two kinds of income only:

Effectively connected income (ECI). It exists when you are engaged in a trade or business within the United States. It is reported on Form 1040-NR and taxed on net profit, after deductions, at the graduated rates a resident pays.
Fixed, determinable, annual or periodical (FDAP) U.S.-source income not connected with a U.S. business, such as U.S. dividends, rents or royalties. It is taxed at 30% of the gross amount, or a lower treaty rate, usually through withholding.

Foreign-source income that is not connected with a U.S. business is not taxed there while you are a non-resident. And for services, the source is where the work is performed, not where the client is or where the LLC was formed.

If you provide services from outside the U.S.

This is the most common case: you design, code or consult from your home country, invoice through your LLC and get paid into its U.S. account, even if your clients are American.

If all the work is physically done outside the U.S., that income is foreign-source. The law treats only a few kinds of foreign-source income as ECI, and only if you also have an office or other fixed place of business in the U.S.: rents and royalties for the use of intangibles, income from a banking or financing business, and sales of goods made through that office. Services performed abroad are not on the list. The result: usually no ECI and no federal income tax.

What decides whether you have a U.S. trade or business is the nature of your activities, not where the LLC was formed. Having the LLC, the EIN or the bank account in the U.S. does not change where you work.

When you may have a U.S. trade or business

These situations are common, and the answer depends on the facts:

Working while in the U.S. If you perform services there at any time during the year, you are usually considered engaged in a U.S. trade or business, and that work is U.S.-source. A work trip may already count, unless a treaty says otherwise.
An office or people in the U.S. If the business operates from premises there or with people working there for you, there usually is one.
A dependent agent. The office of someone acting for you can be treated as yours if they have authority to negotiate and conclude contracts in your name and regularly use it, or keep your goods and regularly fill orders from them. The office of an independent agent (a commission agent or broker acting in the ordinary course of their own business) does not count.
Selling products. Running a business in the U.S. that sells products usually means a U.S. trade or business, and income from selling purchased inventory is U.S.-source when it is sold in the U.S. (generally, where title passes to the buyer). If you keep goods stored in the U.S., the case needs a careful look.
U.S. real estate. Rent is U.S.-source, and in some cases you can elect to treat it as ECI and be taxed on the net. A sale is taxed as if you were engaged in a U.S. business.

None of this is automatic. Every case is different, and we review yours before deciding what to file.

Form 1040-NR: when you file it

Form 1040-NR is your personal non-resident return, not the LLC's. Under its instructions, you must file it in several cases, including:

if you were engaged in a U.S. trade or business during the year, even if you had no income from it, no U.S.-source income, or your income is exempt under a treaty; or
if you were not, but received U.S.-source income on which not all the tax owed was withheld.

If you only provide services from abroad and have no U.S. income with tax still owed, you generally don't need to file. When you do:

Deadline: with no wages subject to withholding, June 15 of the following year (June 15, 2026 for tax year 2025); if you received wages as an employee subject to withholding, April 15. If the date falls on a weekend or holiday, the next business day.
Extension: Form 4868, filed by the due date, gives you 6 more months (to December 15 if your due date was June 15). It extends the time to file, not to pay.
ID number: an SSN or, if you can't get one, an ITIN.
File on time or lose deductions: to deduct business expenses, the 1040-NR must be filed within 16 months of its due date (with a stricter rule if you also skipped the prior year's return). If you believe you have no ECI but are not sure, you can file a protective 1040-NR to preserve that right.
Estimated tax: if you expect to owe tax, you may need to make payments with Form 1040-ES (NR).
Self-employment tax: as a non-resident you are generally not subject to U.S. self-employment tax (Social Security and Medicare), unless a social security agreement with your country says otherwise.

Form 1040-NR can be filed electronically.

What the LLC files: Form 5472 and pro forma 1120

ECI or not, a single-member LLC with a foreign owner has its own filing: Form 5472 with a pro forma 1120, every year in which there was any transaction between the LLC and you. Putting money into the LLC or paying its expenses already counts, so it almost always applies. No tax is computed, it goes by fax or mail, it is due April 15 (October 15 with Form 7004), and the penalty for not filing is $25,000. If you have years not filed, read how to catch up.

Multi-member LLCs

An LLC with two or more members is taxed as a partnership by default:

It files Form 1065 every year (unless it had neither income nor expenses) and gives each member a Schedule K-1. For a calendar year it is due March 15, with an extension through Form 7004; the late-filing penalty is computed per partner, per month.
It does not file Form 5472 just because it has foreign members: that form is for foreign-owned corporations and single-member LLCs with a foreign owner.
If the partnership is engaged in a U.S. business, each foreign member is treated as engaged in it too and reports their share on Form 1040-NR.
If there is ECI, the partnership must withhold and pay tax on the foreign partners' share (section 1446) at the highest rate, currently 37% for individuals and 21% for corporations, using Forms 8813, 8804 and 8805. It does not apply to income that is not ECI.

If your LLC has several members, we review its obligations with you before anything is filed.

State taxes and sales tax

Everything above is federal tax. Each state has its own rules, and that is where many surprises come from:

Annual taxes or fees just for having the LLC, even with no income. Delaware charges $400 a year to LLCs formed or registered there (due June 1), and California $800 to LLCs organized there or doing business in the state. Others require an annual report with a fee. We compare them in our guide on the best state for your LLC.
State income tax. Many states tax income sourced in the state, and the IRS warns that some do not honor tax treaties. If your LLC has activity in a state, it needs checking.
Sales tax. Each state sets its own. If you sell to customers in a state, you may have to register and collect it even without a physical presence there: North Carolina, for example, requires it from remote sellers with more than $100,000 in sales sourced to the state in the current or previous calendar year. Each state decides which sales are taxable and at what threshold.

Tax treaties

The U.S. has income tax treaties with many countries, which can reduce or eliminate U.S. tax on certain U.S.-source income received by residents of the other country. The official list is on irs.gov (“United States income tax treaties – A to Z”): it includes, for example, Mexico, Spain, Chile and Venezuela, and does not include Argentina or Colombia. With no treaty, or if the treaty doesn't cover that income, the general rules apply.

Each treaty is different. According to Publication 901, under several of them (Canada, Germany or the United Kingdom, for example) what an independent professional from the other country earns in the U.S. is taxed there only if they have a permanent establishment, a fixed place of business such as an office or a warehouse. The Mexico treaty exempts those services if the person is in the U.S. for no more than 182 days in a 12-month period and has no fixed base regularly available. Claiming a treaty means meeting its conditions and, sometimes, disclosing it on Form 8833. It has to be checked case by case.

When a client or platform asks for a W-8 or a W-9

Whoever pays you from the U.S. will ask for a form to know whether you are a U.S. or a foreign person. Form W-9 is for U.S. persons: a foreign person may not provide one. Because your LLC is a disregarded entity, the Form W-8BEN-E instructions say it generally does not provide its own form: its owner does, with Form W-8BEN if you are an individual or Form W-8BEN-E if the owner is a foreign company. If the income is ECI, the right form is Form W-8ECI.

Some platforms ask for it in the LLC's name or through their own questionnaire. Check carefully what you are asked for before signing: the payer uses that form to decide whether to withhold tax and how much.

And in your home country

The U.S. not taxing you does not mean the income goes untaxed everywhere. Your country of residence has its own rules for what you earn through a U.S. LLC, and each country treats it in its own way. For that part you need an adviser in your country; we send you copies of everything filed in the U.S. for them.

Forms and deadlines at a glance

Form	Who files	Due date (calendar year)
5472 + pro forma 1120	A single-member LLC with a foreign owner, if there were transactions with the owner	April 15; October 15 with Form 7004
1040-NR	You, if you had a U.S. trade or business or other U.S. income with tax owed	June 15 with no wages subject to withholding; April 15 with them. Extension with Form 4868
1065 and K-1s	An LLC with two or more members	March 15; extension with Form 7004
State taxes and reports	The LLC, depending on the state	Depends on the state (Delaware: June 1)

Common mistakes

“My LLC is in the U.S., so it pays tax like an American company.” It is disregarded: what matters is whether you have ECI or U.S.-source income.
“I owe no U.S. tax, so I file nothing.” The LLC still files Form 5472 with a pro forma 1120.
Working on a U.S. trip without thinking about it. That work is U.S.-source and usually creates a U.S. trade or business.
Putting off the 1040-NR when there is ECI. File late and you can lose the right to deduct your expenses.
Signing a W-9 because the LLC is American. With a foreign owner, a W-8 is the right form.
Forgetting the state. The annual tax or report and sales tax depend on the state, and some states don't follow treaties.
Filing a BOI report “just in case.” Since August 2026, LLCs formed in the U.S., including foreign-owned ones, no longer file one.

How we help

At BMS of NC we start by understanding how you work: where you perform your services, whether you sell products, whether you travel to the U.S. or have members or staff there. From that we tell you what you need to file and what you don't. We prepare and file Form 5472 with its pro forma 1120, Form 1040-NR when it applies (electronically), the ITIN if you need one and your state's annual report, and we send you copies of everything for your local adviser. In English or Spanish, online, from any country.

Frequently asked questions

What taxes does a non-resident pay on a U.S. LLC?

A single-member LLC doesn't pay federal income tax on its own: the IRS treats it as a disregarded entity and its income is attributed to you. As a non-resident, the U.S. only taxes your effectively connected income (ECI) and certain U.S.-source income, such as dividends, rents or royalties. State fees and whatever you owe in your home country are separate.

Do I pay U.S. tax if I run my LLC from abroad for American clients?

Usually not. For services, the source is where the work is performed, not where the client is. If all the work is physically done outside the U.S. and you have no office or dependent agents there, there is usually no ECI and no federal income tax. Having the LLC, EIN or bank account in the U.S. doesn't change that, but working during a U.S. trip can.

Does a foreign LLC owner have to file Form 1040-NR?

Only in certain cases: if you were engaged in a U.S. trade or business during the year, even with no income from it, or if you received U.S.-source income on which not all the tax was withheld. If you only provide services from abroad, you generally don't need to file. When you do, it is due June 15 if you had no wages subject to withholding.

If I owe no U.S. tax, do I still have to file anything?

Yes. Tax or no tax, a single-member LLC with a foreign owner files Form 5472 with a pro forma 1120 every year in which there was any transaction with you, and putting money into the LLC or paying its expenses counts. It is due April 15, goes by fax or mail and computes no tax. Your state may also charge an annual fee or require a report. BMS of NC can help with this.

Want us to review it for you?

Free 15-minute consultation on WhatsApp or video call. We tell you what you need to file and a fixed price, before we start.

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This guide is general information about U.S. tax rules and does not replace advice on your specific case.