Key Takeaways:

  • Registering a business in the USA provides credibility, access to a large market, and financial advantages, particularly for international entrepreneurs.

  • Non-residents can own LLCs or corporations, making the U.S. business environment accessible globally.

  • Choosing the right business structure—LLC, S-Corp, or C-Corp—is critical for determining liability, tax implications, and scalability.

  • Selecting a state for formation, such as Delaware, Wyoming, or Nevada, impacts taxes, incentives, and compliance.

  • LLCs are flexible and ideal for non-residents, while S-Corps are limited to U.S. citizens or residents. C-Corps allow unlimited shareholders and are suited for growth-oriented businesses.

  • Post a job on UpCounsel to find a business lawyer in your state.

Starting a business in the United States has several advantages. It gives access to one of the world's largest and most profitable marketplaces, boosts your company's authority, and grants access to advantageous financial systems. 

Whether you are a US resident or a foreign entrepreneur, registering a business must be approached methodically. 

This guide will walk you through the major phases of registering a business in the United States and determining which structure suits your needs. 

Why Registering a Business in the USA is Beneficial

Registering a business in the United States positions your company for success. Understanding these benefits upfront will help you approach the registration process with confidence. 

For example, when you register a business in the USA, it allows you to: 

  • Open a United States bank account so you can sell to domestic clients

  • Gain access to a new market that can enhance the reputation of your business, both in your home country and in the US

  • Open online accounts with businesses like Amazon FBA 

There are many situations where you don’t need to set up a company in the USA (if you’re a sole proprietor, for example). However, you will forego personal liability protection and legal and tax benefits if you don't register your company.

Step 1: Choose the Right Business Structure for Your Company

Choosing the right business structure is one of your most impactful decisions. Your choice impacts taxation, liability, and operational flexibility.

LLC (Limited Liability Company)

An LLC is a popular choice for its flexibility.  

It divides personal and company responsibilities, preserving assets while simplifying tax duties. Non-residents appreciate that ownership is not limited based on citizenship.

S Corporation (S-Corp)

S-corporations offer tax advantages by avoiding double taxation. However, they have tight ownership restrictions, enabling only U.S. citizens or residents to purchase shares. This structure may not be appropriate for overseas enterprises. 

C Corporation (C-Corp)

C-Corps are excellent for firms looking to attract investors or go public. They allow for unlimited shareholders and offer tax benefits on reinvested earnings. While subject to double taxation, the trade-off may be advantageous in terms of scalability. 

 Step 2: Decide on a State for Your Company Formation

When it comes to business regulations, no two states are alike. Your choice of state can influence taxes, compliance requirements, and business incentives.  

Below are some instances of how these rules differ by state: 

  • Delaware: Known for its business-friendly environment, Delaware offers flexible corporate laws and privacy protections.

  • Wyoming: A favorite for LLCs, Wyoming boasts low fees and a lack of state income tax. 

  • Nevada: Offers strong legal protections and no corporate income tax, making Nevada another appealing option for businesses.

Step 3: Select a Unique Business Name and Trademark Protection

A distinctive business name helps set your company apart and prevents legal complications. 

Begin by confirming the availability of your selected name in your state's company register.  

Once confirmed, file for trademark protection with the U.S. Patent and Trademark Office. This step guarantees your brand's legal protection and stops others from using a similar name. 

Step 4: Find a Registered Agent for Your Business

Every U.S. business needs a registered agent to handle official correspondence, such as tax notices and legal documents. 

A reliable agent ensures your business stays compliant with state regulations. You can choose an individual or a professional service.  

Still, the agent must be available during standard business hours and have a physical address in the state where your business is registered.

 Step 5: Apply for an Employer Identification Number (EIN)

An Employer Identification Number (EIN) is like a Social Security number for your business. To open a business bank account, hire employees, and file taxes, you will need an EIN. 

Non-residents can apply for an EIN online through the IRS website or by submitting Form SS-4 by mail. Be prepared to provide basic business details, such as your structure and ownership information.

Step 6: Register Your Business with State Agencies

Registering your business at the state level is a vital step in becoming operational. 

This normally entails submitting formation documentation to the Secretary of State’s office. If you intend to operate in numerous states, you may need to register in each of them. 

Differentiating between federal and state registration requirements helps cover your legal bases. 

Step 7: Set Up a Business Bank Account in the USA

A separate business bank account is vital for managing finances and ensuring compliance. 

Many U.S. banks require an EIN, formation documents, and proof of ownership to open an account. As a non-resident, you may also need a U.S. mailing address or a registered agent to fulfill the bank’s requirements.

 Step 8: Obtain Necessary Licenses and Permits

You may need specific licenses or permits to operate legally, depending on your industry. 

For example, healthcare, construction, or food services businesses must meet regulatory requirements that vary by state. Check with local and state agencies to ensure your business is fully compliant.

LLC vs. S-Corp vs. C-Corp: Which Structure is Right for You?

Consider your business goals, ownership plans, and tax preferences when selecting a structure. 

Here are a few considerations to keep in mind for each structure: 

  • LLC: Flexible, ideal for small businesses, and suited for non-residents looking for simplicity in management and taxes.

  • S-Corp: Tax-efficient but limited to U.S. citizen or resident ownership, making it less accessible for international entrepreneurs.

  • C-Corp: A scalable option that attracts investors, accommodates unlimited shareholders, and supports growth despite double taxation.

Should I Open a Separate Business Bank Account?

It is highly recommended that you have separate bank accounts for your personal and business use. Sometimes, this can even be a state requirement.  

In the USA, a business bank account is usually needed depending on the type of company you want to register.  

Having separate bank accounts to track financial transactions is essential for business owners, especially small businesses, to build a sustainable business.  

This information helps document your company's financial health and aids in future business decisions in your best interests. Having separate bank accounts also allows you to pay less in taxes.

 How Long Does It Take to Register a Company in the USA?

Companies in the USA need to register with the Secretary of State's office of the business location.  

After you submit your registration requirements, the government will examine and evaluate the information before authorizing it. This process may vary in time, depending on the state.  

In most states in the USA, the Secretary of State can take four to six weeks to approve an application for an LLC or S-corporation, sometimes longer. Rush processing is available in certain states, such as New York.  

If your business plan is time-sensitive, it is best to pay the additional charge because this service reduces processing time to two to three business days. This fee can vary between states, so inquire where you want to register your company. 

Where to Base Your Business in the USA?

Choosing your company's location is one of the most important decisions you will make, so consider the following: 

  • Demographics

  • Understand your local competition

  • Find your supply chain

  • Compare state laws and tax regulations

  • Ensure you stay on budget 

Your decision should meet all your company's business objectives most cost-effectively (without sacrificing quality).  

For example, big cities in the USA can bring more business to your company, but there is more competition.  

Each business is different, so you have to decide which factors weigh more for your business. Is it the location? Transportation? Accessibility to skilled labor?

 Can Non-Residents Own an LLC in the USA?

The simple answer is yes. You do not have to be a US resident to own an LLC in the United States.  

The business structure of an LLC allows anyone to apply regardless of their citizenship status. However, registering a business as a non-resident involves a more tedious process than being a resident.   

Other business structures, such as an S corporation, do not allow non-residents to own a company within the USA.

Can a Foreign Business Own the US Company?

If you opt to set up an LLC, then yes, your foreign business can own the US company. This is done by appointing your foreign company as the managing member instead of an individual person.  

If you decide on a corporation, you must name a director (an individual) at registration.  

Directors are not necessarily company owners. Shareholders own corporations; in that regard, your foreign business can be the 100% owner of a corporation in the US. 

If you are a foreign citizen interested in tax benefits like pass-through profit distributions, consider an LLC. With a regular C corporation, the business is subject to double taxation.  

S corporations are off-limits for non-citizens, as they cannot own shares. This is why many foreign businesses opt to set up LLCs.

Can a Foreign Resident Work in the US If They Own an LLC or Corporation?

Foreign citizens cannot receive a salary or compensation for services provided in the United States unless they obtain work permits issued in the country.  

Some work permits will only allow a foreign citizen to work for a sponsoring employer.  

These will not allow you to work for a different and new company that a foreign citizen formed. That would require a separate permit.

How Long Does Incorporation Take?

Processing times will vary between states based on their work backlog. In most cases, foreign citizens have to wait at least 30 days to obtain an EIN. When you need a Tax ID, and the directors or owners are non-citizens, it must be filed with a special IRS unit. 

If you need help registering a company in the United States, post your legal requirements on UpCounsel's marketplace.  

UpCounsel only accepts the top 5% of lawyers on its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.

Register a Company in USA: FAQs

Can non-residents own an LLC or corporation in the USA?

Non-residents can own an LLC or a company in the United States. LLCs are popular among overseas businesses because of their flexible ownership laws and simple tax filing process. 

Corporations, such as C-Corps, also permit non-resident ownership and are frequently used by firms seeking scalability or investment possibilities. 

Is a separate bank account necessary?

Yes, having a separate bank account is strongly advised and frequently necessary. It aids in preserving accurate financial records, streamlines tax filings, and assures adherence to US company regulations. 

A separate account safeguards personal assets by keeping them separate from corporate funds. 

What is the difference between foreign and domestic business registration?

A domestic business is registered in the state where it predominantly operates, whereas a foreign firm is registered in a different state from where it was founded.  

For example, if you form an LLC in Delaware but operate in California, you must register as a foreign business in California.

How long does the registration process take?

The time frame varies depending on the state and the type of business entity. On average, forming an LLC or corporation can take anywhere from a few days to a few weeks. Expedited processing is often available for an additional fee.

Can a foreigner register a company in US?

Yes, foreigners can register a company in the U.S. There are no citizenship or residency requirements for owning a U.S. LLC or corporation. However, having a registered agent in the state of formation and meeting U.S. banking requirements are necessary steps.

Can I start an LLC in the US as a foreigner?

Yes. Foreigners can start an LLC in the U.S. by selecting a state, choosing a business name, hiring a registered agent, and filing the necessary formation documents. They must also obtain an EIN and set up a business bank account.

Which state is best for LLC for non-residents?

Non-residents frequently consider Delaware, Wyoming, and Nevada among the best states for forming an LLC. 

Delaware is recognized for its advantageous business rules, Wyoming has relatively inexpensive fees, and no state income tax, and Nevada has robust privacy safeguards. The ideal state is determined by your business's particular demands and activities.