Form 5472 for foreign-owned US LLCs
A single-member US LLC owned by a non-US person usually pays no US income tax and files no US income tax return. But since 2017 it must file an information return every year, and the penalty for skipping it is $25,000, even if the LLC had no income at all.
Who files
A US LLC that is wholly owned, directly or indirectly, by one foreign person and treated as a disregarded entity is treated as a corporation for this one purpose: a “reporting corporation” under IRC § 6038A. It must file Form 5472 attached to a pro forma Form 1120 for every tax year in which it has a reportable transaction with its owner or another related party. In practice that means every year, because the owner funding the LLC or paying its bills counts.
Multi-member LLCs (partnerships) and LLCs that elected corporate taxation follow different rules; foreign-owned US corporations file Form 5472 with their regular Form 1120.
What counts as a reportable transaction
- Capital contributions from the owner, and distributions back to the owner.
- Formation costs, registered-agent fees, or other expenses the owner paid on the LLC's behalf.
- Loans in either direction, and interest on them.
- Sales, purchases, rents, royalties, and services between the LLC and the owner or related companies.
Essentially, any money or value moving between the LLC and a related party is reported, with amounts in US dollars.
How to file
- Get an EIN for the LLC first See EIN without an SSN.
- Complete a pro forma Form 1120: only the entity name, address, EIN, and a few identifying items; write “Foreign-owned U.S. DE” across the top. No income or tax computation.
- Complete Form 5472: Part I describes the LLC; Part II the foreign owner (with a foreign tax ID or reference number); Part IV or V lists the transactions and amounts.
- Send it by fax or mail: these returns can't be e-filed. The Form 5472 instructions list the IRS fax number and the Ogden, Utah mailing address.
- Deadline: April 15 for calendar-year LLCs (the 15th day of the 4th month). File Form 7004 by then for an automatic six-month extension to October 15.
Penalties
Failing to file a complete and timely Form 5472, or to keep the records that support it, costs $25,000 per form per year. If the IRS sends a notice and the return still isn't filed within 90 days, another $25,000 accrues for each 30 days of continued failure. The penalty applies regardless of whether any tax was owed. Reasonable-cause relief exists but is hard to get for simply not knowing the rule.
Worked example
A German founder forms a Wyoming LLC in March 2026, pays the $100 filing fee and a $100 agent fee personally, contributes $10,000 of capital, and later reimburses herself $2,000 for software costs. All four movements are reportable transactions. Even though the LLC made no sales, it files a pro forma 1120 and Form 5472 for 2026 by April 15, 2027. The formation-year contributions alone require the return, even with no sales, and each missed year carries its own $25,000 penalty.
Related obligations
Keep the LLC's state filings current too (Wyoming anniversary report or Delaware's June 1 tax). US-formed LLCs no longer file BOI reports with FinCEN See BOI in 2026, so Form 5472 is now the main federal ownership filing for a foreign-owned LLC. If the LLC earns US-source income or has a US trade or business, it may owe actual US tax and need more than a pro forma return; talk to a cross-border tax adviser.
Sources
- IRC §§ 6038A, 6038C; Reg. §§ 1.6038A-1, 301.7701-2(c)(2)(vi)
- Form 5472 and Form 1120 instructions; Form 7004 instructions