Wyaoming LLC. Non-Resident (online business). No taxes? Controversy!!!

[Basilia]

Wyaoming LLC / Non-Resident from Russia / 1 member.
Online business. No office, no employees, no permanent partners in the US.
Customers from all over the world, including the US (or example mostly in the US).
Doesn't want to go to jail or get in trouble with the IRS.

We have two theories, two camps! 50/50.
One says 0% taxes.
Others say, you go to jail.

Both rely on laws. How is that possible?!!
It's either legal or it's not!

Opponents talk about an
- aggressive interpretation of the law on the issue of 0% tax,
- about withholding tax,
- about the fact that for a non-resident is better suited C-corp,
- the terrible annual reporting on the LLC for non-resident.

So what's legal? Why can there be two opinions?!

 

[ion3000]

I'm from Ecuador. I have a C Corp incorporated in Delaware.

Online business. No office, no employees, no permanent partners in the US.
Customers from all over the world, including the US.

I do pay a franchise fee on Delaware every year for $450.

Every year you have to fill the form 1120 to federal income taxes. I use an online software to do this. Never had any problem and I can do everything online.

Take note that if you receive payments from your C Corp, you will need to fill the form 5472 and then you can not do it online.

I wrote a post about how to avoid this in a legal way.

I have a friend that have an LLC. For me this is not the best choice as you have to report you personal assets every year. He always end up paying a lot more than me in taxes and accountants.

 

[EliasIT]

You try to avoid paying taxes, that's not possible any longer from 2022 and onward you want to pay your taxes, get them reduced to a minimum with the help of a good local tax advisor, will help you.

 

[Basilia]

You try to avoid paying taxes, that's not possible any longer from 2022 and onward you want to pay your taxes, get them reduced to a minimum with the help of a good local tax advisor, will help you.

No-no-no! Not avoid it, but do it right. (although tax-free options seem possible if you live in Paraguay or Singapore, etc. countries)

You still have to pay at the place of residence. That is the question. I need to choose a simple jurisdiction, I need to understand where and how much to pay.

And I hear two different opinions! Which is nonsense.

good local tax advisor, will help you

Yes, and if you go to several, they may give different answers...

 

[Fulton Abraham Sanchez]

You pay 0 tax with LLC one member. C-Corp you pay 21% on profits plus 15% when dividends are distributed.

The only way to be taxed is if any of your clients report the LLC to the IRS when giving you a payment.

 

[Basilia]

The only way to be taxed is if any of your clients report the LLC to the IRS when giving you a payment.

So 0% is illegal? If someone reports, the IRS will find out about it and make you pay.

 

[nkf]

I wonder if you got the answer? And who did you use to incorporate the Wyoming LLC?