I am Swedish citizen and I am looking to form Single Member LLC in USA for my online business (selling ebooks and similar).
Can you please count and explain everything that I need in order to form and operate Sigle Member LLC . What would be the best setup for that particular situation?
I also have some specific questions regarding Single Member LLC:
– Should I file Form 8832 (IRS) and elect to be classified as corporation? Would that be beneficial or even neccessary in case of Single Member LLC?
– Should I apply for EIN?
– Should I have US bank account?
I’m confused with all the information, please try to explain as detailed as possible.
Being that you are looking to run your business in an online environment, I would suggest looking into the possibility of opening your LLC in a state like Wyoming or Delaware. These states offer very nice tax benefits, as well as more flexibility regarding maintenance and privileges as your business grows.
The costs of registering your LLC will vary depending on shipping options, additional services, and which state you decide is right for your business. The basic things you would absolutely NEED to establish your business are the applicable state filing fees, the EIN (this is the company’s federal tax id issued by the IRS, which is absolutely necessary for the singe-member LLC to do business if you don’t have Social Security Number), a state sales tax vendor id (if you sell taxable goods), a Registered Agent and international shipping of your documents. If you were to register your LLC in Wyoming, for example, this process would cost $466.
Typically with a single-member LLC, it is better to be taxed as a sole-proprietor rather than taxed as a corporation. LLC’s allow the income of the company to be “passed-through” onto your personal income, where it is taxed as such. A corporation is first taxed on it’s income, and then you pay taxes on your profit share. This is commonly referred to as “double-taxation”. In my opinion, you should choose to be taxed as a standard LLC, however, I am not a professional accountant, so it is always recommended you consult with a respective professional to know for certain what tax structure would be the most beneficial for you.
As for the company’s bank account, you can get an Apostille attached to your American business paperwork (as Sweden is a signatory of the Hague Convention) allowing you to open the company bank account in your home country of Sweden. However, you would most likely have to physically come to the United States to open the bank account here.
I hope you found this answer to be helpful.
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