US tax obligations for a foreign-owned company: a high-level map

The core US tax obligations for a foreign-owned company depend on the entity you choose. A US C corporation files a federal income tax return on Form 1120 and pays federal tax at 21%. A single-member LLC wholly owned by a foreign person files a pro forma Form 1120 with Form 5472 attached, even if it had no income. On top of that come state taxes and the question of how money moves between the US company and its foreign owner. This article maps those obligations at a high level, based on IRS and state pages as of October 2026. It is not tax advice.

Your entity choice sets the tax shape

Most of what follows flows from one early decision: C corporation or LLC. Stripe's Atlas documentation summarizes the difference well. C corporations pay federal income tax at the entity level and can typically use early losses to offset future taxes. LLC profits and losses pass through to the owners by default, and with a non-US founder, Stripe notes, tax filings can become complex.

That trade-off is covered in detail in our comparison of a Delaware C corp vs LLC for foreign founders. If you have not chosen yet, read that first, along with our overview of the benefits of incorporating in the US. The rest of this article assumes you have.

The main charges, per IRS and Delaware pages as of October 2026:

These filings are a running cost that belongs in the decision to incorporate. Greatweek does not prepare tax filings; its US Market Entry work tests whether the US opportunity is real at your stage, and a US Entry Diagnostic gives a 90-day recommendation with sequencing and cost for the board.

Federal corporate income tax and Form 1120

A US C corporation reports its income on Form 1120. The Form 1120 instructions for 2025 set the federal rate at 21% of taxable income.

The return is generally due by the 15th day of the 4th month after the end of the tax year, which is April 15 for a calendar-year corporation. The instructions give a different rule for corporations with a June 30 year end, which file by the 15th day of the 3rd month. An extension is requested on Form 7004, filed by the regular due date. Check the current extension period and any payment deadlines on the IRS site or with your advisor.

A US corporation owned by a foreign company or foreign founders is still a US taxpayer on its own income. The foreign ownership does not change the return it files. It does add questions about related-party transactions, covered below.

Form 5472 for foreign-owned single-member LLCs

The obligation founders most often miss is Form 5472. According to the Form 5472 instructions (Rev. December 2024), a foreign-owned US disregarded entity is a domestic disregarded entity wholly owned by a foreign person. It must file a pro forma Form 1120 with Form 5472 attached. Only the name, address and items B and E on page 1 of Form 1120 are required.

These filings cannot be e-filed. The instructions direct them to be faxed to 855-887-7737 or mailed to the IRS in Ogden, Utah, with "Foreign-owned U.S. DE" written across the top of Form 1120.

The penalty is what makes this important. Failing to file, or filing a substantially incomplete form, carries a $25,000 penalty, plus another $25,000 if the failure continues more than 90 days after the IRS notifies you. That applies even to an LLC with little or no activity.

Corporations with foreign ownership can have their own Form 5472 reporting duties as well. Ask your advisor whether your structure triggers them.

State taxes: separate from Delaware franchise tax

State tax is a second layer, and it is easy to confuse two Delaware charges.

The first is franchise tax, which every Delaware corporation and LLC pays for existing as a Delaware entity. Our guide to Delaware franchise tax covers the due dates and methods.

The second is Delaware corporate income tax. The Delaware Division of Revenue states, as of October 2026, that every domestic or foreign corporation doing business in Delaware owes 8.7% on federal taxable income allocated and apportioned to Delaware, unless exempt. Corporations whose Delaware activities are limited to maintaining and managing intangible investments may qualify for an exemption. In general terms, a Delaware-incorporated startup that operates elsewhere usually deals with Delaware franchise tax rather than Delaware income tax, but have your advisor confirm how this applies to you.

The states where you actually have staff, an office or customers may also tax your income or your sales. Those rules vary by state and are not summarized here. Sales tax is its own topic, and our guide on accepting US payments explains how state sales tax thresholds work.

Transfer pricing and intercompany flows

If your US company is a subsidiary of your home company, money will move between them. The parent may license software, provide staff or charge management fees. The US company may pay for those services or send profits back.

Tax authorities on both sides can question whether those charges are priced fairly. In practice:

• put written intercompany agreements in place early
• price them on a defensible basis
• keep the records

This is an area where your home-country advisor and your US advisor need to talk to each other, because a change on one side affects the other.

A related development: under the 2025 tax law, domestic research and experimental expenditures are deductible for taxable years beginning after December 31, 2024, while foreign research costs are amortized over 15 years, per the IRS summary of the new provisions. If your development team sits outside the US but is paid by the US company, ask how this affects you.

Tax treaties

Your home country may have an income tax treaty with the US that changes withholding on dividends, interest or royalties paid across the border, or how business profits are taxed. Whether a treaty applies depends on the specific payment and the documentation in place. Ask your advisor which treaty applies and what forms the US company needs from the foreign recipient.

What is no longer required

One obligation has gone away. On August 11, 2026, FinCEN issued a final rule permanently removing beneficial ownership reporting for US companies and US persons, effective on publication on August 14, 2026. A US-formed company is exempt even if it is owned by foreigners. Foreign companies registered to do business in a US state still report. Any older guide telling you every new LLC must file BOI is out of date.

Frequently asked questions

Does a foreign-owned US company have to file a tax return if it had no income?

A foreign-owned single-member LLC must file a pro forma Form 1120 with Form 5472 attached, per the IRS instructions (Rev. December 2024). A C corporation files Form 1120 annually. Ask your advisor about your specific case.

What is the penalty for not filing Form 5472?

$25,000 for failing to file or filing a substantially incomplete form, plus a further $25,000 if the failure continues more than 90 days after IRS notification.

When is Form 1120 due for a calendar-year corporation?

April 15, the 15th day of the 4th month after year end, per the 2025 Form 1120 instructions. Extensions are requested on Form 7004 by that date.

Does a Delaware C corp pay Delaware income tax?

Delaware corporate income tax applies to corporations doing business in Delaware, at 8.7% on income allocated to Delaware as of October 2026. Franchise tax is a separate annual charge.

Tax obligations are manageable once they sit on a calendar with an owner. If you want help deciding whether a US entity is the right next step, book a 20-minute US Entry Review. Greatweek is not a tax advisor: these rules reflect IRS and state pages as of October 2026, and you should confirm every filing and position with a qualified US tax advisor before acting.