If you are a non-U.S. founder with a Single-Member LLC (SMLLC), you have probably heard of Form 5472, the annual report required by the IRS for foreign-owned U.S. entities. It is one of the most misunderstood parts of U.S. compliance for global founders.
At Bookmate, we help hundreds of SMLLCs each year file Form 5472 correctly. One of the most common questions we receive is: what financials do we actually include in this form?
This article breaks down what goes into the financial section of Form 5472, what does not, and how Bookmate ensures every report is complete and compliant.
The Purpose of Form 5472
Form 5472 exists to help the IRS track transactions between a U.S. LLC and its foreign owner. The form is not meant to calculate profits or taxes owed. Instead, it is a disclosure form that shows the flow of money between the company and its foreign owner.
If your LLC is 100 percent foreign-owned and has not elected to be treated as a corporation, it is considered a disregarded entity for tax purposes. That means it does not file its own income tax return, but it must still submit Form 5472 each year together with Form 1120 as a cover page.
Even if your company had no income, it must still report transactions such as capital contributions or reimbursements. The goal is transparency, not taxation.
What Financials Are Reported on Form 5472
The financial data reported on Form 5472 is very specific. The IRS only wants to see transactions between the foreign owner and the LLC, not the company’s full profit and loss.
Here are the most common categories that appear on the form:
- Capital Contributions
Whenever you transfer money from your personal account into your U.S. LLC, that is a capital contribution. It shows that you are investing in your business and providing funds for it to operate.
Example: You transfer $5,000 from your personal account in Chile to your U.S. LLC’s account. That $5,000 is a capital contribution, and it must be reported on Form 5472.
- Loans Between the Owner and the LLC
If you lend money to your LLC or if your LLC lends money to you, it must be reported as a loan transaction. The IRS tracks these to ensure that the transfers are legitimate and not used to hide taxable income.
Example: Your LLC covers a personal expense that you later reimburse. That temporary use of funds counts as a loan and is included in the form.
- Payments for Services
If your LLC pays you, the foreign owner, for services such as management, consulting, or design work, those payments are reportable transactions.
Example: Your U.S. LLC pays you $2,000 for design work performed abroad. That amount must be shown on the form under “Payments for Services.”
- Reimbursements and Expense Payments
If you personally pay for company expenses such as software, equipment, or subscriptions and your LLC reimburses you later, those payments are also included.
The same applies if your LLC pays a personal expense on your behalf. Even if it was an accident that you later corrected, it must be reported for transparency.
- Distributions to the Owner
Although most SMLLCs are disregarded and do not formally issue dividends, any distributions made to the owner must also be included. This is less common, but relevant in cases where funds are transferred out of the LLC to the owner’s personal account for purposes other than reimbursement.
What We Do Not Present on Form 5472
This is where many founders get confused. Form 5472 does not include the company’s full financial statements. You are not required to report:
- Your company’s total revenue
- Business expenses or operating costs
- Profit or loss
- Client payments or invoices
- Balance sheets or income statements
The IRS is not asking for your sales or your expenses. It is only asking for related-party transactions between the owner and the LLC.
So, even if your business had high revenue or significant expenses, those details stay in your internal accounting records. You do not present them to the IRS in the 5472.
At Bookmate, we make this clear to every client: the form is not about your income, it is about transfers between you and your company.
Why These Numbers Matter
Even though the financials reported are limited, they are extremely important for compliance.
The IRS imposes a $25,000 penalty for each year that Form 5472 is not filed or is filed incorrectly. Reporting the right figures helps prove that your company is legitimate, transparent, and following U.S. regulations.
These transactions also serve as a record that your LLC has substance and that the relationship between you and the company is properly documented.
How Bookmate Handles the Financial Section
At Bookmate, our CPA team follows a structured process to prepare your Form 5472 accurately and efficiently.
Step 1. Transaction Review
We begin by reviewing your bank statements or transaction lists. Our accountants identify every payment or transfer that qualifies as an owner-related transaction.
Step 2. Categorization
Each transaction is assigned to the correct category: capital contribution, loan, payment for services, reimbursement, or distribution.
Step 3. Conversion to USD
All transactions are converted to U.S. dollars using the official IRS exchange rates for the year.
Step 4. Verification
The CPA team checks that each number matches your supporting records and that all required details are consistent.
Step 5. Filing
Once reviewed, we prepare and submit the Form 5472 and the accompanying Form 1120 to the IRS. You receive a confirmation copy for your records.
This process ensures that your filing is accurate, consistent, and penalty-proof.
Common Mistakes Founders Make
Many founders who try to file on their own make avoidable mistakes. Here are some we see most often:
- Reporting revenue or expenses instead of owner transactions
- Forgetting to list capital contributions
- Mixing personal and business funds, making transactions unclear
- Using the wrong currency conversion rates
- Omitting small reimbursements that still count as reportable
Bookmate’s review process prevents these errors. Our team makes sure your form includes the right information and excludes what does not belong.
Why You Do Not Report Revenue or Expenses
To make this extra clear, revenue and expenses do not appear on Form 5472 because they are not transactions between your LLC and its owner.
Revenue represents money coming from clients, not from you as the owner. Expenses represent money going to vendors or service providers, not to you.
The IRS does not consider these “related party transactions.” Therefore, they stay in your internal bookkeeping records, not on the form itself.
This distinction is one of the biggest sources of confusion for first-time filers. That is why Bookmate reviews every transaction with care before deciding whether it needs to be included.
The Bottom Line
Form 5472 does not show your company’s full financial picture. It focuses only on the money that moves between you, the foreign owner, and your U.S. LLC.
You do not need to report your sales, your expenses, or your profits. You only report capital contributions, loans, reimbursements, service payments, and distributions.
These limited financials are what keep your company compliant and in good standing with the IRS.
At Bookmate, we take care of everything: reviewing your transactions, classifying them correctly, converting currencies, and submitting the form on time. You can relax knowing your LLC is fully compliant and penalty-free.
If you are unsure which transactions to include or how to classify them, our team is ready to help.
Schedule your free consultation with us today. Or visit our website at www.bookmate.com to learn more about how we help international founders stay compliant with confidence.
