Starting a new venture can be exciting and scary at the same time. These feelings can be more overwhelming if a business is opened in another country. Because of the constant political and economic changes taking place in the US, you might be having second thoughts if the timing is right to open a business there. Nevertheless, the country has received a lot of foreign businesses and will not likely stop.
If you are planning to start a business in the US as a non-resident, the ways are rather simple. Moreover, there are many resources to help you do this successfully. Continue reading to know some tips on how to get started in opening a company in the US.
Do I Need to Get a Business Visa for My Business in the US?
If you plan to reside or expand your business in the US, the visa that you are going to obtain depends on the current state of your business.
If you have a business in another country outside the US that is involved in trading for at least a year and you have 4 or more employees, you need to get an L-1A visa.
On the other hand, if your business has been operating for less than a year and only has less than 4 employees, you need an E-2 visa. An E-2 visa is also recommended if you do not have any existing businesses outside the US and want to move and start your business there. This is also the most popular option for business owners and the most similar to the start-up visa offered in the US.
Tips on How to Start a Business in the USA as a Non-Resident
Pick Your Business’ Structure
The first thing you need to do when opening a business in the US is to choose a structure that suits your business best. The business structure you chose will influence other business-related factors such as the risks, daily operations, and taxes.
You must understand the different business structures so that you can see if your business’ goals match your chosen structure. Some of these structures are LLC, sole proprietorship, S-Corporation, and C-Corporation. It is not recommended to pick S-Corporation since it is best for US residents. Getting tax advice from an expert is recommended before choosing since these structures have different taxes.
LLC is the ideal choice for non-US citizens to start a business in the US. One advantage of an LLC is that it keeps your assets safe from debts and business lawsuits. Therefore, if anything happens to your business, your assets such as your house, bank account, and car are protected. You can also easily form an LLC and enjoy cheaper tax structures.
A C-Corporation is another business structure recommended for non-US citizens who want company shares and expect an investor to purchase shares from their company. Some investors opt for this structure since they can privately keep their shares without having to think about tax penalties until they sell their shares later.
A sole proprietorship does not need any formal documentation, so it is very simple. You can be considered a sole proprietor if you operate a business and do not have other registered businesses.
Hire a Registered Agent
You need to get a registered agent who has a physical and not post box address and must be a resident in the state where you plan to open your business before registering your LLC.
Your agent is the one who will get important documents for you during office hours. Some of these documents are official papers and legal files. The agent makes sure that you do not miss any required documents that might be needed in lawsuits or state taxes.
Register Your Business
After you have decided on your business structure and registered agent, what you need to do next is to register it. The required filings during the registration process need to be completed by you.
This process can be a bit complex. You also need to be patient since you do not want to make any errors. That is why it is recommended to ask for help from a business lawyer in the registration process. This is one of the most effective ways to successfully open a business in the US.
The incorporation procedure can last from 1 business day to a month. The period depends on how long the Secretary of State processes the documents and the state where your business will be incorporated.
Acquire an Employer Identification Number
The US requires all businesses to have an employer identification number or EIN or tax ID number. The Internal Revenue Service or IRS releases this number and the organization uses it to identify businesses.
It is as vital as a social security number. This is also what you need to legally operate in the US. Other things your business needs to smoothly run are to get a mailing address in the US, open a business bank account and business merchant account, get business insurance, and an individual tax identification number or ITIN.
Finally, launching a business in the US will not be too complicated if you follow the tips given and seek help from experts. It can be too risky to do it on your own since your assets are involved. Asking for professional help can save you money and time as well.