US LLC formation for non-residents in 2026: Delaware, Wyoming and the Form 5472 penalty

A US LLC is the fastest, cheapest company a non-resident founder can form anywhere in the developed world. It is also the one most often sold on a misunderstanding, and the misunderstanding carries a USD 25,000 penalty attached to it.

Here is the short version. A Delaware LLC costs about USD 110 to file the Certificate of Formation and registers in one to three business days, with same-day and one-hour expedite available. A Wyoming LLC costs USD 100 and takes roughly 24 hours. There is no minimum capital, no US-residency requirement for members, directors or officers, no statutory audit, and no in-person or notarial step. An LLC is pass-through by default — no entity-level federal tax, with profits taxed in the members' hands. A Delaware C-corporation, taxed at a flat 21% federally, is the standard vehicle where venture fundraising is intended.

How to form a US company

1. Choose the state and entity — Delaware LLC or C-corp, or Wyoming LLC — and clear the name.
2. Appoint a registered agent with a physical in-state address. Mandatory in the state of formation.
3. File the Certificate of Formation (LLC) or Certificate of Incorporation (corporation) with the Secretary of State and pay the fee.
4. Adopt the operating agreement (LLC) or bylaws and issue shares (corporation).
5. Obtain an EIN from the IRS. Foreign owners without a Social Security number apply on Form SS-4.
6. Open a US bank or EMI account and register for any applicable state, sales or franchise taxes.

Form 5472 is the thing that ruins people

A foreign-owned single-member LLC — a disregarded entity for US tax purposes — must file IRS Form 5472 together with a pro forma Form 1120 every year. The penalty for failure to file starts at USD 25,000.

Read that again against the USD 100 formation fee. The asymmetry is the whole risk profile of this structure. Thousands of non-residents form a US LLC on the strength of a video promising a tax-free American company and never learn that an annual federal filing exists until a penalty notice arrives.

If you form a US LLC, engage someone to handle Form 5472 in year one and every year after. It is not optional and it is not expensive relative to the exposure.

The tax-free claim, properly stated

An LLC is pass-through: there is no entity-level federal income tax, and profits are taxed to the members. Neither Delaware nor Wyoming levies state corporate income tax on income earned outside the state, and Wyoming has no corporate income tax at all.

That is where the accurate part ends. US-effectively-connected income or US-source income triggers federal tax — and often state tax and withholding — regardless of where the owner lives. A Delaware or Wyoming LLC escapes state income tax only where it has no in-state nexus. And the income does not disappear: it flows to the members, who are taxed by their own countries, and home-country controlled-foreign-company rules may attribute the profit to the owner directly.

A US LLC is a good vehicle for a non-resident with genuinely non-US-source income and a clear home-country tax position. It is not a way to earn money nobody taxes.

Delaware or Wyoming

Wyoming is cheaper to form and to keep — USD 100 to file and a USD 60 minimum annual report licence tax — with light disclosure. It suits a low-cost holding company.

Delaware costs about USD 110 to form and USD 400 a year in LLC franchise tax, raised from USD 300 under House Bill 400 effective 1 August 2026. What it buys is the Court of Chancery, a century of settled corporate case law, and the fact that every US investor and their counsel expects it.

The rule is straightforward. If you will raise venture capital, form a Delaware C-corporation — not an LLC — because that is what investors will require and converting later is expensive. If you want a low-cost holding vehicle with light disclosure, Wyoming. If you want a US operating company that will deal with sophisticated American counterparties, Delaware.

Beneficial ownership, with a caveat

Under FinCEN's March 2025 interim final rule, US-formed companies are exempt from Corporate Transparency Act beneficial-ownership reporting, and only foreign reporting companies must file. That rule has been litigated and the position has moved more than once. Confirm the current status before relying on it rather than treating it as settled.

Who this is actually for

A non-resident founder with non-US-source income who wants a cheap, fast, universally recognised entity — for consulting, software, e-commerce or as a holding company — and who will file Form 5472 every year without fail.

It is the wrong answer for someone whose home country will simply tax the profits anyway and who is forming it in the belief that it will not, which is a large share of the people who do.