Panama or Costa Rica Corp registering US LLC for Investment purposes

[pdash]

I am a partner in a Panamanian and Costa Rican corporation. I am investigating option of opening a US LLC (eg. Delaware, Wyoming, Nevada) for the purpose of opening trading accounts in the US. We would like to open a TastyTrade account for options trading and an Interactive Brokers account for stock trading. TastyTrade does not allow a Panamanian or Costa Rican company to register an account.

Would this be possible? Would we be able to open a bank account for the LLC?

Thank you.

 

[Fred]

Panama is definitely more popular for US Stock Brokers compared to Costa Rica and in General most likely the most streamlined Country for a Company Formation in South America.

We opened already successful with a Panama Offshore Company an Interactive Brokers Account - they requested a basic Balance Sheet - after we mentioned that no Audited Accounts are in place - worked perfectly fine.

What's the reason for incorporating a US LLC instead of forming a separate Panama Offshore Company which opens the Interactive Brokers Account?

If a US Stock Broker doesn't open for a Panama Company standalone, chances are even lower with a Company Holding Structure as Company Shareholder Structures are more Compliance Intensive.

I recommend you to either stick with a Broker that accepts Panama and then open directly with a Panama Offshore Company the Account.

Alternative you can open a US LLC as Single Owner Individual, open Stock Broker Accounts and then change the Shareholders to your Panama Company.

I hope you are aware of the fact that the here in this Forum well-known US LLC Structure is only tax neutral as a disregarded single Member structure with an Individual Single Shareholder - basically it's a passthrough entity that is passing the tax liability to the single Owners Personal Tax Residence.

Having a Panama Company Shareholder in a US LLC triggers Tax Liabilities.

 

[Koedam]

LLC is only pass-through without taxation in the USA, if there are no business activities in the USA. (Active) trading on exchanges in the USA will likely be seen as business activity and makes the LLC liable for taxation in the USA.

Even trading through an entity outside the USA with a USA broker, will in some cases make the entity liable for taxation in the USA. If the entity complies with the "Trading Safe Harbor" rules, trading could be exempt of taxes in the USA for the entity outside USA.