A foreign-owned single-member LLC is considered a disregarded entity by the IRS for federal income tax purposes.
Foreign individuals are not required to file a separate form for their LLC to report taxable income. This reporting is done through the owner’s tax return.
If you are a foreigner filing taxes for your LLC, you need to report the business or rental activities of the LLC on Form 1040NR (U.S. Non-resident Alien Income Tax Return). Even if your LLC has no income, you may be obligated to file taxes. For example, you might consider filing a tax return for an LLC without income if you want to qualify for tax credits or a tax refund. You should also file Form 5472 on Information Return of a 25% Foreign-Owned U.S. Corporation or a Foreign Corporation Engaged in U.S. Trade or Business with a pro forma Form 1120 (U.S. Corporation Income Tax Return). For a foreign-owned U.S. disregarded entity filing Form 1120, write “Foreign-owned US DE” at the top and complete the entity’s name, address, and items B and E.
Even if there is no U.S.-sourced income, it is essential to file Form 5472 and a pro forma Form 1120.
As a single owner, you have the option to elect to treat your LLC as a corporation for tax purposes.
If the LLC’s activities are engaged in a U.S. trade or business, then the foreign member is taxed on the LLC’s effectively connected income (ECI) as a pass-through. This ECI is taxed on a net basis at graduated tax rates. Depending on the tax bracket of the foreign member, they may be subject to rates ranging from 10 to 37 percent (as of 2025).