Are you thinking of forming a U.S. business from India to launch a SaaS startup, build an ecommerce brand, or offer consulting services to U.S. clients? You’re not alone. Thousands of Indian entrepreneurs have successfully formed U.S. LLCs to reach global markets, streamline payment processing, and build credibility with American customers and partners.
Setting up a U.S. LLC can be a game-changer, especially if you're targeting clients on platforms like Stripe, PayPal, Amazon, or Upwork. The good news? You don’t need to be a U.S. resident or even step foot in the country to get started.
Can an Indian Citizen Form a U.S. LLC?
Absolutely. U.S. law allows non-residents, including Indian citizens, to form and own LLCs without restriction. There’s no requirement to have a U.S. Social Security Number, no need to live in the U.S., and you can complete the entire process online. You’ll just need to choose the right state and follow a few procedural steps to ensure your LLC is legally registered.
Step-by-Step: How to Form a U.S. LLC from India
- Choose a State
Start by selecting a state for incorporation. Delaware is well-known for its robust legal system and startup-friendly courts, making it a favorite among tech founders and venture-backed startups. Wyoming and New Mexico are also popular for their low filing fees, minimal annual requirements, and privacy-friendly policies. Think about your goals—whether you're seeking investor funding, privacy, or low maintenance costs—and choose accordingly.
- Pick a Business Name
Choose a unique business name that complies with your chosen state's naming rules. Make sure it isn’t already in use by another company by checking the state’s online database. Also, consider domain availability and potential trademark conflicts if you’re building a long-term brand.
- Hire a Registered Agent
Every U.S. LLC needs a registered agent with a physical address in the state of formation. This agent will receive important legal documents on your behalf. Most formation services include this as part of their package, typically charging between $50 and $150 per year.
- File Articles of Organization
The Articles of Organization (sometimes called Certificate of Formation) is the core legal document that establishes your LLC with the state. You’ll need to provide details like your company name, registered agent, and principal business address. Filing fees vary by state but generally fall between $50 and $150. Some states offer expedited services for an extra fee.
- Get an EIN (Employer Identification Number)
An EIN is like a Social Security Number for your business. It’s required to open a U.S. bank account, hire employees, and file federal taxes. If you don’t have a Social Security Number, you can still apply for an EIN using Form SS-4, which must be submitted by fax or mail to the IRS. Many founders choose to work with a U.S. tax advisor to streamline this step and avoid delays.
- Draft an Operating Agreement
Though not legally required in all states, an operating agreement is highly recommended. This internal document outlines how your LLC will operate, defines ownership percentages, and helps prevent disputes—especially in multi-member LLCs.
Many Indian founders use trusted formation services like Firstbase, Doola, or similar partners to handle all these steps. These services bundle everything from registered agents to EIN filings, making the process smooth and hands-off.
Do You Need an ITIN to Form an LLC?
You do not need an ITIN (Individual Taxpayer Identification Number) to form an LLC or obtain an EIN. However, if you plan to personally receive U.S.-source income or need to file a 1040-NR as a non-resident, you’ll likely need an ITIN. This involves filing IRS Form W-7, often alongside your first U.S. tax return, or with a certified acceptance agent.
How to Open a U.S. Business Bank Account from India
Opening a U.S. business bank account is crucial for receiving payments and managing expenses. The traditional route involves flying to the U.S. and visiting a bank like Chase or Bank of America in person, with your LLC documents and EIN. This can be expensive and inconvenient.
Luckily, modern fintech platforms make it easier. Mercury, Relay, and Wise Business allow Indian entrepreneurs to open U.S. business accounts remotely. These platforms generally require your EIN, Articles of Organization, passport, and sometimes proof of address.
They also offer perks like virtual debit cards, international wire support, and integrations with accounting tools. Some may ask for a U.S. phone number or utility bill—requirements that can often be met with virtual office providers.
Common Businesses Formed from India
Many Indian entrepreneurs choose to form U.S. LLCs to gain access to global payment systems, improve business credibility, and reduce friction with U.S.-based platforms. SaaS companies often incorporate in the U.S. to attract international users and investors who are more comfortable dealing with a Delaware entity.
Freelancers and consultants use U.S. LLCs to easily invoice U.S. clients, especially through Stripe or PayPal. Ecommerce founders running Amazon FBA or Shopify stores form LLCs to comply with platform requirements and improve conversion rates.
Digital product creators—like course sellers or template designers—form U.S. entities to tap into markets where customers prefer or require U.S. billing addresses. Marketing and SEO agencies benefit from presenting themselves as U.S.-based for added trust and pricing flexibility. These businesses choose U.S. LLCs to streamline operations, lower cross-border transaction costs, and ensure smoother compliance with platforms like Upwork, Stripe, or QuickBooks.
Tax Obligations: Foreign-Owned U.S. LLCs
Understanding tax obligations is key to staying compliant. Even if you don’t owe U.S. taxes, you may still have annual reporting requirements.
For single-member LLCs owned by a non-resident, the IRS treats the entity as a "disregarded entity" unless it elects otherwise. Each year, you must file Form 5472 along with a pro forma Form 1120 to disclose foreign ownership and report any transactions between you and your LLC.
This includes things like funding the business or taking distributions. If your business has effectively connected income (ECI) with the U.S.—such as from a dependent agent, U.S. office, or real estate—it may be subject to federal tax, and you may also need to file Form 1040-NR to report that income. However, if your income is not U.S.-sourced, there may be no federal tax liability, just the reporting requirement.
State-level requirements vary. Delaware, for example, charges a flat $300 annual franchise tax, even if you don’t do business there. Wyoming charges a minimal annual report fee based on assets located in the state. Always check the requirements of the state you incorporate in to avoid late fees and penalties.
For multi-member LLCs, the IRS treats the business as a partnership. This means filing Form 1065 annually, and distributing Schedule K-1s to each member. Each non-resident member will need to file Form 1040-NR to report their U.S. income.
Depending on the nature of income and state laws, partners may also be subject to state-level withholding taxes or additional compliance requirements. Choosing the right structure and understanding your obligations early can help avoid costly penalties and unnecessary tax exposure.
Final Tips and Reminders
Forming an LLC is only the first step. Staying compliant with federal and state rules is what keeps your business running smoothly. Maintain good financial records, file annual reports on time, and understand the nuances of cross-border tax laws.
Bookmate can help with handling your federal tax filings, including Forms 5472, 1120, and 1065. If you have questions about state-level obligations or ITIN requirements, we can also point you in the right direction or connect you with a trusted advisor. Book a free consultation to get expert, personalized guidance tailored to your needs. Learn more at trybookmate.co
Disclaimer: This article is for informational purposes only and does not constitute legal or tax advice. Each tax situation is unique. Please consult Bookmate or a qualified advisor.
