I ran across something I don't understand and I hope you can help.
A non-citizen has a single-member LLC in the US. He's required to file
Form 5472 - no problem there.
But does he file Form 1040-NR, 1120 or both? I've seen conflicting information, and couldn't find specific information on the IRS website. Perhaps the people saying that a foreign owned single-member LLC is automatically taxed as a corporation think it's a foreign entity rather
than a foreign owned entity.
In any case, I'm confused.
Can anyone help straighten me out?
Thanks.
I ran across something I don't understand and I hope you can help.
A non-citizen has a single-member LLC in the US. He's required to file
Form 5472 - no problem there.
But does he file Form 1040-NR, 1120 or both? I've seen conflicting information, and couldn't find specific information on the IRS website. Perhaps the people saying that a foreign owned single-member LLC is automatically taxed as a corporation think it's a foreign entity rather
than a foreign owned entity.
In any case, I'm confused.
Can anyone help straighten me out?
Thanks.
--
Stu
http://DownToEarthLawyer.com
--
Stuart O. Bronstein wrote:
I ran across something I don't understand and I hope you canGW Carter CPAs has a US Tax Guide for just this purpose. See link
help.
A non-citizen has a single-member LLC in the US. He's required
to file Form 5472 - no problem there.
But does he file Form 1040-NR, 1120 or both? I've seen
conflicting information, and couldn't find specific information
on the IRS website. Perhaps the people saying that a foreign
owned single-member LLC is automatically taxed as a corporation
think it's a foreign entity rather than a foreign owned entity.
In any case, I'm confused.
Can anyone help straighten me out?
Thanks.
below.
What it tells you is assuming the LLC has not elected to be a
corporation then it is a disregarded entity and would file 1040-NR
with a Schedule C if a business or Schedule E if rental property.
The 5472 would go with the 1040-NR. Section 6038(a) of the
Internal Revenue Code states that because it is owned by a foreign
person it is a separate entity classified as a corporation. BUT,
this is for reporting purposes only. Taxes are still done on the
1040NR. So, it means that you have to attach a pro-forma 1120
with the 5472 and 1040-NR. Pay careful attention as there are
stiff penalties for failing to conform to these rules.
The tax guide below goes into this with a lot of detail and
instructions.
https://gwcarter.com/us-tax-guide-for-nonresident-aliens-with-singl e-member-llc
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