The short answer: A US LLC wholly owned by one foreign person must file Form 5472, attached to a pro forma Form 1120, for every tax year in which it had a reportable transaction with its owner, and putting money in or taking money out counts. File by fax to 855-887-7737 or by mail to Ogden, Utah, by April 15 for a calendar year. It can't be e-filed. Not filing costs $25,000.
Why a tax-free LLC still files
A single-member LLC is normally "disregarded" for US income tax: it doesn't file its own income tax return. For a long time, that meant a foreign-owned LLC could have no US filings at all. The IRS closed that gap with regulations under section 6038A. For tax years beginning on or after January 1, 2017, a US disregarded entity wholly owned by a foreign person "is treated as an entity separate from its owner and classified as a corporation" for the limited purpose of these reporting rules (IRS Form 5472 instructions).
That's all the rule does. It doesn't make your LLC pay corporate tax. Whether you owe any US income tax is a separate question about effectively connected income. Form 5472 is an information return: it tells the IRS who owns the LLC and what money moved between you.
What counts as a reportable transaction
For a foreign-owned LLC, the instructions are broad. Part V of the form covers transactions "in connection with the formation, dissolution, acquisition, and disposition of the entity, including contributions to, and distributions from, the entity." In practice that includes:
- Money you send from a personal account into the LLC's bank account
- Money the LLC pays out to you
- LLC costs you pay personally, such as the state filing fee or registered agent fee
- Loans between you and the LLC, and interest on them
- Sales, services, rents or royalties between the LLC and you or another company you control
That's why "my LLC made no money" isn't a reason to skip it. If you paid the formation fee or funded the bank account, you have something to report.
How to file, step by step
- Have an EIN. The LLC needs its own. If you applied on Form SS-4 as a foreign-owned disregarded entity, line 9a already says "Form 5472." Get an EIN without an SSN.
- Prepare a pro forma Form 1120. Write "Foreign-owned U.S. DE" across the top. The IRS says the only information required is the LLC's name and address and items B and E on the first page.
- Complete Form 5472. Check the box for a foreign-owned US DE. In Part II, report the foreign owner. Enter the owner's foreign tax ID number (FTIN) if there is one, or "None" or "N/A." File a separate Form 5472 for each related party you had reportable transactions with.
- Attach a statement for Part V. Describe each transaction or group of transactions with enough detail to show what it was and its approximate value.
- Fax or mail it. There's no e-file option for foreign-owned DEs.
| Fax | 855-887-7737 (300 DPI or higher) |
|---|---|
| Internal Revenue Service, 1973 Rulon White Blvd, M/S 6112, Attn: PIN Unit, Ogden, UT 84201 | |
| E-file | Not allowed for foreign-owned US DEs |
| Due date | The due date of the pro forma Form 1120, including extensions. April 15 for a calendar-year LLC. |
| Tax year | The same tax year the owner uses for US filings, or the calendar year if the owner has none |
| Extension | Form 7004 by the original due date, with "Foreign-owned U.S. DE" written across the top and the Form 1120 code on Part I, line 1. Fax or mail it to the same number and address. |
Don't use the regular Form 1120 mailing addresses. The instructions give foreign-owned DEs their own dedicated address, shown above.
The $25,000 penalty
The IRS instructions are blunt: "A penalty of $25,000 will be assessed on any reporting corporation that fails to file Form 5472 when due and in the manner prescribed." The same penalty applies for failing to keep the records required by Regulations section 1.6038A-3. If the failure continues for more than 90 days after the IRS notifies you, an additional $25,000 applies for each 30-day period, or part of one, that it continues.
"In the manner prescribed" matters. Filing the wrong way, such as trying to e-file or sending it to the wrong address, can count as not filing.
Keep these records
The recordkeeping rule is its own penalty trigger, so keep a simple file for every year:
- Bank statements for the LLC account
- Proof of every transfer between you and the LLC, with dates and amounts
- Invoices and receipts for formation, agent and other costs you paid personally
- Your operating agreement and any loan agreements with the LLC
- Copies of every Form 5472 and pro forma 1120 you filed, plus fax confirmations or mail tracking
Common mistakes
| Mistake | What the rules say |
|---|---|
| "No revenue, so no filing" | Contributions and distributions are reportable transactions. |
| Trying to e-file | Foreign-owned DEs can't file Form 5472 electronically. |
| Using the regular 1120 address | Use the dedicated fax number or the Ogden PIN Unit address. |
| Filling out the whole 1120 | Only name, address and items B and E are required on the pro forma return. |
| Assuming the formation service files it | Formation packages usually don't include annual federal filings. Ask in writing. |
| Missing the extension window | Form 7004 must be filed by the original due date. |
Doing it yourself vs hiring help
The form itself is short, and many single-owner LLCs with a handful of transfers file it themselves. If your LLC buys from or sells to other companies you own, borrows from you, or has income that might be effectively connected with a US business, pay a US CPA or enrolled agent who handles foreign-owned LLCs. That one review costs far less than the penalty.
Questions people ask
Who has to file Form 5472?
A 25% foreign-owned US corporation, a foreign corporation engaged in a US trade or business, and a US disregarded entity wholly owned by one foreign person, such as a single-member LLC owned by a nonresident. The LLC files for any tax year in which it had a reportable transaction with a related party.
Do I have to file Form 5472 if my LLC had no income?
Usually yes. Income isn't the test. Reportable transactions include money you contribute to the LLC, money you take out and amounts paid in connection with forming it. Most new LLCs have at least one of those in their first year.
Can I e-file Form 5472 for a foreign-owned LLC?
No. The IRS instructions say a foreign-owned US disregarded entity can't file Form 5472 electronically. You fax it with a pro forma Form 1120 to 855-887-7737 or mail it to the IRS in Ogden, Utah.
When is Form 5472 due?
By the due date of the pro forma Form 1120, including extensions. For an LLC on a calendar year that is April 15. You can get an extension by filing Form 7004 by the original due date.
What is the penalty for not filing Form 5472?
$25,000 for each failure to file on time and in the required way, and the same $25,000 for failing to keep the required records. If the failure continues more than 90 days after the IRS notifies you, another $25,000 applies for each 30-day period it continues.
Does a multi-member LLC owned by foreigners file Form 5472?
The pro forma 1120 and Form 5472 rule on this page applies to a US disregarded entity wholly owned by one foreign person. An LLC with two or more members is taxed as a partnership by default and has different filings. Ask a US tax professional which returns apply.
Sources
- IRS: Instructions for Form 5472 (Rev. December 2024)
- IRS: About Form 5472
- IRS: Instructions for Form 7004
- IRS: Instructions for Form SS-4 (EIN application, international applicants)
- IRS: Effectively connected income (ECI)
- IRS Publication 519: U.S. Tax Guide for Aliens
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