Who has to file
A US LLC with one owner is normally ignored for federal income tax: a 'disregarded entity'. Since 2017 there is one exception. When that single owner is a foreign person or foreign company, the LLC is treated as a corporation for one purpose only: reporting. It must file Form 5472, attached to a pro forma Form 1120, for every year in which it had a reportable transaction with its owner or another related party.
What counts as a reportable transaction
Almost any movement of money or value between the LLC and its foreign owner or related parties: the money you put in to start the company, payments you take out, loans in either direction, and expenses you paid personally for the company. Paying the formation cost of the LLC yourself already counts. In practice nearly every foreign-owned single-member LLC files every year.
Deadline and how to file
The filing is due on April 15 for a calendar-year company. An extension of six months is available with Form 7004, filed by the same date. The pro forma 1120 carries only the name, address and EIN of the company and a few header items; the substance is on Form 5472. This package cannot be e-filed like a normal return; it is sent to a dedicated IRS address or fax number.
The penalty
The penalty for failing to file, filing late or filing an incomplete Form 5472 is $25,000 per form, per year, and it increases if the IRS sends a notice and the failure continues. The LLC must also keep records that support what was reported. This is by a distance the most expensive mistake a foreign founder can make with a US LLC, and it is easy to avoid.
Does this mean the LLC pays US tax?
Not by itself. Form 5472 is an information return. Whether income is taxable in the United States depends on whether the business is carried on in the US. Many foreign-owned LLCs with no US office, staff or dependent agents owe no federal income tax and still must file Form 5472 every year.
How to make it routine
Keep company and personal money separate from day one, record every transfer between you and the LLC, and close the books each year. CORA, the bookkeeping tool we work with, was built for foreign-owned LLCs: it tracks the owner transactions during the year and prepares the 5472 package when the year closes.
Frequently asked
My LLC had no revenue. Do I still file Form 5472?
Usually yes. Money you put into the company or costs you paid for it are reportable transactions, even with zero revenue.
Does a multi-member LLC file Form 5472?
A multi-member LLC is a partnership by default and files Form 1065 instead, with its own rules for foreign partners.
This guide is general information, not legal or tax advice. Rules and fees change; check your own situation with a professional.