How to Start a Business in the USA as a Foreigner

Opening a company in the United States does not require American citizenship or a Green Card. The American legal system allows foreigners of any nationality to register and operate companies on U.S. soil, making the U.S. one of the most accessible destinations in the world for international entrepreneurs. However, there is a fundamental distinction that every foreign entrepreneur needs to understand before starting the process: owning an American company and having authorization to work in it are legally distinct situations.

Business Structures in the U.S.

The two most commonly used structures by foreign entrepreneurs are the LLC (Limited Liability Company) and the Corporation (typically a C-Corp). The LLC is the most popular option for smaller businesses and individual investors, offering limited liability protection, tax flexibility, and administrative simplicity. The Corporation is more suitable for companies seeking outside investors, planning to issue shares, or intending to scale operations quickly.

The most sought-after states for company registration by foreigners are Delaware, Wyoming, and Florida. Delaware is traditionally preferred for its sophisticated corporate legislation and its specialized Court of Chancery. Wyoming offers lower state fees and greater privacy regarding owner information. Florida combines the absence of state income tax with a strategic location, being especially popular among Latin American entrepreneurs.

Formation costs vary by state: filing fees range from approximately $50 to $500. In addition to the state fee, it is mandatory to designate a Registered Agent with a physical address in the state of formation to receive legal correspondence and court notifications on behalf of the company.

EIN, ITIN, and Tax Obligations

Every American business needs an EIN (Employer Identification Number), the equivalent of a business tax identification number. Foreigners without an SSN (Social Security Number) can obtain it by filling out the IRS Form SS-4, writing “Foreign” in the SSN field, and sending it by fax or mail. The process is free and the number is usually issued within four to six weeks. The IRS online tool for obtaining the EIN is not available for applicants without an SSN or ITIN.

The ITIN (Individual Taxpayer Identification Number) is not required for company formation or for obtaining the EIN, but becomes mandatory when the foreign owner needs to file a personal income tax return in the U.S. If the LLC generates U.S.-sourced income, the owner must file Form 1040-NR (Non-Resident Income Tax Return), and for this, needs the ITIN, which is requested via Form W-7 accompanied by the tax return.

Companies owned by non-resident foreigners are subject to taxation on income effectively connected to the U.S. (ECI, Effectively Connected Income) and on fixed or determinable income (FDAP, Fixed or Determinable Annual or Periodical). The rules vary according to the company structure, type of activity, and the existence of tax treaties between the U.S. and the owner’s country, making tax planning an essential component of the process.

Visas for Entrepreneurs

Owning an American company does not authorize the foreign owner to reside or work in the United States. To be physically present in the business on U.S. soil, an appropriate visa is required. The main options include the E-2, L-1, and EB-5, each with distinct requirements and advantages.

The E-2 visa (Treaty Investor) is intended for citizens of countries that maintain a treaty of commerce and navigation with the U.S. It is important to note that not all countries have this treaty: Brazil, India, China, and other major economies are not eligible for the E-2 directly. Citizens of countries without a treaty who have dual citizenship with a signatory country (such as Italy, Portugal, Spain, or Japan) can use the passport of the treaty country for the application. There is no legally fixed minimum investment amount, but case law requires “substantial” capital in relation to the total cost of the business. In practice, investments starting at $100,000 are more competitive. The consular fee is $315, and the visa can be renewed indefinitely as long as the company remains active.

The L-1 visa (Intracompany Transferee) is ideal for entrepreneurs who already own a company abroad and wish to open a branch, subsidiary, or affiliate in the U.S. The applicant must have worked at the foreign company for at least one year in the last three years in a managerial, executive, or specialized knowledge position. The L-1A (managers and executives) allows a stay of up to seven years and offers a direct transition to the EB-1C Green Card category, making it one of the most strategic routes for entrepreneurs planning permanent residence.

The EB-5 visa (Immigrant Investor) is the only route that grants a Green Card directly through capital investment. The minimum amount is $800,000 in Targeted Employment Areas (TEA, including rural and high-unemployment areas) or $1,050,000 in areas outside TEA. The investment must create or preserve at least ten full-time jobs for American workers. These amounts, established by the 2022 reform (EB-5 Reform and Integrity Act), remain in effect in 2026 with the next review scheduled for 2027.

Ownership Versus Operation

This is the most misunderstood point by foreign entrepreneurs and the source of serious planning errors. A foreigner can legally own 100% of an American company without ever setting foot in the United States. They can receive dividends, participate in virtual meetings, make strategic decisions, and manage operations remotely. What they cannot do, without the appropriate visa, is reside in the U.S. and perform in-person operational functions on a daily basis.

This distinction has important practical implications. An entrepreneur can register an LLC, obtain the EIN, open a business bank account, and operate the business entirely from abroad. If at any point they wish to move to the U.S. and work in person at the company, they will need to obtain one of the visas mentioned. Working physically in the U.S. without proper immigration authorization, even in your own company, constitutes a violation of immigration law.

Business Bank Account

Opening a bank account in the U.S. is often the biggest practical hurdle for non-resident foreign entrepreneurs. Most major traditional American banks require physical presence at a branch to open business accounts, in addition to extensive documentation. Some digital financial institutions offer remote opening for LLCs registered in the U.S., but may impose initial transaction limitations and require additional identity verification.

The documents typically required include the LLC’s Articles of Organization or Certificate of Formation, the Operating Agreement (company agreement), the IRS EIN Letter, the owner’s valid passport, and proof of address in the country of origin. Keeping business documentation organized and up to date from the moment of registration significantly facilitates both the banking process and compliance with annual tax obligations before the IRS and state authorities.

Victoria Harper

Editor-in-Chief

Meet the author

Leading journalism and editorial content at Visto n’ Visa, Victoria helps make immigration topics clear, trustworthy, and easy to understand. Her focus is on delivering useful, human, and relevant content for people exploring new paths abroad.