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shaonkushtia

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Nov 9, 2019
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#1
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Hey, all team members I need help with tax. I want to open an LLC in Wyoming state.

I am an Affiliate/CPA marketer I am working couple of companies like ClickBank/Amazon affiliate and more companies now I want to open an LLC and Open bank account with Mercury purpose Received Commission payment.

So anyone please help me in Wyoming state. Will there be any tax on this? Just want to receive payment.

Thanks
 
#5
Wouldn't there be an issue as to where the profit is derived from, ie sales to US customers or payments from US companies?
 
#7
Yes, 30% or treaty rate.

Altough you do not have ECI from the U.S., tax is due because you have income of type "commissions" from the U.S. - one type of passive income (among royalties, interest and dividend) that is taxed even if not ECI.

Amazon or another affiliate network which makes the payment is liable for withholding the tax and paying to the IRS from every distribution they make to you.

Likewise, foreign Amazon Kindle publishers who make sales in the U.S. and earn royalty income are liable for 30% or treaty rate, whether they incorporated a pass-through LLC in the U.S., a foreign Ltd. or none at all (sell as individuals)
 
#11
CaptK said:
So can you clarify for us all as we are all making assumptions.
Commission
Royalties
Service
What nationality are you
What country do you reside in

Then we can all give our opinion.
Click to expand...

1.Affiliate Commission ( like I am promoting Affiliate/Cpa network product they give me per sell Commission example sell $50 product they give me Commission $30)
2. My nationality is Bangladesh
3.Bangladesh
 
#12
xzars said:
Yes, 30% or treaty rate.

Altough you do not have ECI from the U.S., tax is due because you have income of type "commissions" from the U.S. - one type of passive income (among royalties, interest and dividend) that is taxed even if not ECI.

Amazon or another affiliate network which makes the payment is liable for withholding the tax and paying to the IRS from every distribution they make to you.

Likewise, foreign Amazon Kindle publishers who make sales in the U.S. and earn royalty income are liable for 30% or treaty rate, whether they incorporated a pass-through LLC in the U.S., a foreign Ltd. or none at all (sell as individuals)
Click to expand...

Affiliate Commission ( like I am promoting Affiliate/Cpa network product they give me per sell Commission example sell $50 product they give me Commission $30)
 
#16
Keep in mind that if you start a LLC in US as a single member, Amazon's tax interview will disregard the LLC and handle it as if income is paid to you personally. You can still receive payment to the LLC's bank account, but there is no way to have Amazon treat the LLC as the receiver of the income. This is also the way IRS views the income, so it makes sense. I assume other US companies like Clickbank etc handles it the same way.
 
#18
shaonkushtia said:
Is there has any tax for this purpose?
Click to expand...

There's going to be some tax unless you live in a 0% treaty rate country. Choosing to incorporate a paper-only entity in some 3rd party jurisdiction doesn't erase the liability.

"Free of all tax" in the U.S. is also achievable if you incorporate a U.S. LLC which elects to be taxed as a corporation or partnership (taxed on entity-level in the U.S. even if all beneficiaries are non-U.S. persons). Then the affiliate network no longer has tax witholding liability on your commissions due. Liability shifts to your company. At your own risk, and not being delusional that you're up to something legal: accept the untaxed funds from the network, promising to pay tax yourself, and then embezzle the funds out of the U.S. company to Nigeria or wherver you live without paying the taxes due.

30% Better margin, or possibly B&B in the land of the free for a few years..
 
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#19
xzars said:
There's going to be some tax unless you live in a 0% treaty rate country. Choosing to incorporate a paper-only entity in some 3rd party jurisdiction doesn't erase the liability.

"Free of all tax" in the U.S. is also achievable if you incorporate a U.S. LLC which elects to be taxed as a corporation or partnership (taxed on entity-level in the U.S. even if all beneficiaries are non-U.S. persons). Then the affiliate network no longer has tax witholding liability on your commissions due. Liability shifts to your company. At your own risk, and not being delusional that you're up to something legal: accept the untaxed funds from the network, promising to pay tax yourself, and then embezzle the funds out of the U.S. company to Nigeria or wherver you live without paying the taxes due.

30% Better margin, or possibly B&B in the land of the free for a few years..
Click to expand...
However Amazon doesn't seem to withhold any taxes on affiliate income. So I guess affiliate income is not taxable in the US.
 
#20
xzars said:
"Free of all tax" in the U.S. is also achievable if you incorporate a U.S. LLC which elects to be taxed as a corporation or partnership (taxed on entity-level in the U.S. even if all beneficiaries are non-U.S. persons).
Click to expand...

I’m pretty sure the corporation would have to pay branch office tax (and submit required reports) - which was introduced precisely for that reason.
 
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