Have you ever dreamt of starting your own business in India but you are not aware of the correct path that is to be followed? We all know that forming a business in the USA is highly profitable because of its highly strong & developed economy. The USA stands in the second position in global revenue. Some of the other benefits which foreign entrepreneurs acquire by starting their business in the USA are high market demand, several tax exemptions, and enhanced legal protections. There is no bar to the type of business one can start in the USA. No matter what your nationality is, you can start your business in the USA by following certain easy steps.
How non-residents can reside in the USA for continuing their business?
But before heading towards its steps, you should know the importance of a Green card or entrepreneur visa in a new business. Without a green card and visa, you can start your business in the USA and continue it from outside of its territory but cannot enter the territory of the USA. There are two types of visas available for Foreign entrepreneurs i.e. E-2 and L-1A but E-2 is well-known among all because it is for those who don’t have any business outside the USA. You can Contact your nearest US embassy to get your E-2 Visa by fulfilling all requirements. For possessing a green card and becoming a permanent member of the USA, non-residents have to invest in designated employment regions a minimum of $500,000 or 1$ million in a new commercial venture.
Following are the 8 steps that require to start a new business in the USA.
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Choose your business structure.
Those who are not resident of the US and neither acquire US citizenship has to choose a business entity or structure out of two great options available to them. ie; C corporation and Limited Labiality Company. There is also a third type of entity called S Corporation that is not available for Foreigners but only for US citizens.
C Corporation v. limited liability Company
Both in C Corporations and limited liability companies, the personal assets of the owners and shareholders are protected and are not held liable for the actions or debts of the company. Although Corporations are generally formed by more than one member both LLCs and C Corporation can be started solitary or in multiples. The main document that is required to file LLCs is the Article of Organization and for C corporation is the Article of Corporation. In LLCs, owners are the members while In C corporation, shareholders are the owners. In Corporation, Boards of directors are elected to represent the interest of shareholders and to do meetings for their benefit.
The main difference between a C corporation and Limited liability is that there is a double tax system for a C corporation while in Limited liability, there is a choice to be taxed as a C corporation or pass-through. the compliance requirements of the C corporation are more strict in comparison to LLCs.
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Choose any US state to establish your business
After choosing the business structure, the second thing that needs to be selected is the state where you want to set up your business out of the 50 states in the USA. While finding your state, analyze the state tax structure, various incentives it offers, market demand, production cost and employee rate of the state, and various other parameters that affect your business there. Some states where Foreign entrepreneurs can start their LLCs in the USA are Delaware, Wyoming, or New Mexico and C corporations are Florida, California, or Nevada.
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Give a name to your entity
The name of your LLC or C corporation must not conflict with the names of already existing businesses and it must also comply with the provisions of LLC and Corporation law of the state. The name you choose will become the official name of your company and it will appear on the article of corporation or certificate of organization so choose wisely. Some words are prohibited to be included in the name of the business so must avoid them. If it is a corporation, include the words like corporation, limited or incorporated and limited liability company or limited liability if it is an LLC.
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Register in state agencies
The LLC or corporation is to be registered in the state of formation by appearing physically in the state and holding meetings frequently.
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Get the Registered Agent
A registered agent can be a person or company that receives legal documents and official papers for the company. Registered agent is required to deal with the official government notification, correspondence from the secretary of state, and other legal paperwork. The registered agent is officially recognized by the state of formation and designated by the business.
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Get your taxpayer identification number
All residents and non-residents who have business in the USA must have the taxpayer identification number. To get your TIN, you need to show your social security number, and because non-residents don’t have social security numbers so they must fill out the IRS form W-7 to get their taxpayer identification number (ITIN). ITIN is used for the administration of Tax laws by the IRS.
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Get a physical US. Mailing address
All non-resident business owners should have US Physical mailing address because it is required in the opening of a US Bank account, enhances credibility, adds authenticity to your business, builds trust among customers, and for other business reasons. There are various options available for mailing addresses like PO Boxes, virtual offices, virtual addresses, mailbox services, and coworking spaces.
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Open an account in the US bank
You have to open an account in a US bank. Although the process of opening a bank account is quite complex for foreigners in the US you can do it by following certain guidelines. So, if you have your passport, Physical Mailing address in the US, ITIN number, and corporation documents then you are eligible to open your bank account. You can either visit the US bank in person or contact the same branch in your country only if they provide overseas service.
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