If you are looking to form a business in a foreign country, you may be surprised to learn that the USA has been known as one of the most foreign-friendly countries to start a business.
On top of this, the United States of America has a consistently strong economy and is the current leader for global business and investments. This can be promising for your entrepreneurial endeavors.
How can you start a business in the USA as a non-citizen foreigner? Starting a business in the USA has no citizen or living restrictions. You can use a registered agent service to register your business with an address in the state you are filing in. Starting, buying, or owning a business in the USA does not automatically change your citizenship status, but a green card is not required to begin.
While starting or purchasing a business within the USA can be a relatively easy logistical process, it does come with plenty of challenges. There will be nuances as to types of businesses, as well as laws for working and living, that you will have to navigate. Continue reading to learn more about the types of USA-based businesses you can own as a non-citizen foreigner (both residential or living abroad) and the legal guidelines you will have to follow along the way.
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What types of business can a foreigner own in the USA?
Learn more in our guide: How to Start Your Small Business Legally – Important Legal Requirements
Gaining citizenship in the United States can be a pretty complex process. With that, you might be unsure if your foreign status brings you to a halt in your entrepreneurial journey in the country. Fortunately, there are no residential or citizenship requirements for owning a business in the USA. However, working for and gaining profits from your business is a different story.
What types of business can a foreigner own in the USA? A foreigner (whether living abroad or those who are non-citizens residing in the USA) can start a business of any kind: a sole proprietorship, partnership, limited liability company (LLC), or C corporation. However, working for the business and gaining wages will require documentation.
Unfortunately, just because you are able to start (a.k.a. register) your business in the United States without citizenship status, this does not mean that you will automatically be able to work and live in the country. However, there are ways to make this work so that your efforts are seen as profitable on your end.
Since you will be able to start any kind of business that you want (assuming you meet the business standards to begin), you will likely want to see the profits from your work. To do this, you will need to gain permission to work and reside in the country through a conditional visa or green card.
Fortunately for you, starting a business, gaining legal employment, and paying taxes bode well in your case for permanent residency, which can help you gain a green card. Be sure to keep a record of your efforts all along the way, including any bank accounts or legal documents that you complete.
Since the legal requirements for working and residing in the United States vary based on your unique situation, just know that you will need to research the type of documentation that you will need based on how long you plan to stay in the country and any plans for residency or citizenship applications.
If you are living abroad but would like to start a business in the United States, this is possible, too. Since there are no citizenship requirements for starting a business in the country, and you will not be attempting to live or work in the country, then you need to verify the legality of the wages that you will be receiving and the taxation requirements in the U.S. as well as your country of residence.
More likely than not, you will end up paying United States business taxes for your U.S.-based business. However, your personal taxes might look different depending on how you end up filing in the U.S. (and depending on the laws and regulations in your home country). Often, non-citizen foreigners choose to begin their business as an LLC as they will then be protected from “double taxation” that a C corporation would go through (in which the business would be taxed at both the business level and again on the individual level).
To ensure that you take the proper legal route in obtaining this opportunity — regardless of whether you are a non-citizen foreigner living in the country or abroad — be sure to discuss the legal requirements with an attorney. Preferably, you will be able to find one who specializes in citizenship, employment, and corporate taxes or is at least familiar with these areas.
Verifying the legality of your business will ensure that your efforts do not go to waste, and that you are able to continue growing your business without having to worry about whether the legal side of the company is being taken care of.
Do I have to live in the USA to start a business there?
There are many reasons that you might want to start a business in the USA. Its economy is consistently strong, its world market integration is vast, it provides an entryway to financial opportunities like investors and venture capital, and you can make a plausible case for residency. But your residential status might cause you to question your business venture.
Do I have to live in the USA to start a business there? No, there are no requirements for living in the United States to legally register your business entity in the country. However, employment (receiving wages) from your business will require additional legal documentation. You will be required to pay U.S. taxes annually on your U.S.-based business.
The conditions for starting and owning a business in the U.S. vary from person to person and from business to business as specific situations render different documentation needs. For example, if your business has been opened in your home country, but you have been trading with the U.S. for a year or so, then you will need to complete different forms than if you are a small business that is moving to the U.S. but has not previously participated in trade.
While it might seem like a confusing process, there are manageable ways to figure it out. You can work with a U.S.-based attorney to help ensure that you are taking the legal precautions necessary to prolong the success of your business. It is suggested that you review the specifics of your organization as it stands and where you would like to see it qualify. This can help to ensure that you are filing all of the correct paperwork and will not have to deal with missteps in the future.
There are a variety of foreign-owned businesses in the United States, and many of these businesses are owned by non-citizens who are living abroad. In today’s digital world, there are opportunities for businesses to grow no matter where in the world you are living. Plus, if you ever did plan on moving to the United States to run your U.S.-based business locally, then you can build a strong case for residency as you will be investing (personal) capital to ensure the success of your business.
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ZenBusiness will file your formation paperwork for $0 + state fee. Plus, we offer additional services to help anyone start a business in America.
Do I need a green card or visa to start a business in the USA?
If you are planning to live and work in the US, then you are likely looking at all of the complicated regulations that will make this possible. It can be frustrating and confusing to see all of the paperwork that is required, but you can make this work.
Do I need a green card or visa to start a business in the USA? To start a business in the USA requires no legal residency or citizenship. Contrarily, to live and work in the United States (or, to receive wages from your business while living in the U.S.) will require a Green Card or visa. The particular visa you need depends on your situation.
Since this can be a confusing process, it is best to look at a few starting factors. First, you will need to consider your goals both personally and professionally. If you only plan to live in the country for six months to a year while getting your U.S.-based company off of the ground, for example, then this will be a very different situation than someone who plans to move to the U.S. permanently while working for the business they start in the U.S.
A popular route that many non-citizens end up taking when starting a business in the U.S. is to apply for an E-2 Visa. Though this visa will conclude its residency permissions as soon as your business ceases to operate, it does allow you (and a spouse and children who apply for the E-2 visa) to live and work in the U.S. while your business exists and is profitable. The E-2 Visa is only available to citizens of countries that maintain a treaty of commerce and navigation, or with which the U.S. maintains a qualifying international agreement, or which has been deemed a qualifying country by legislation.
The conditions for this Visa, in terms of the business that you own, basically boil down to the success of your business. Since the conditions of your ability to stay in the U.S. rely on the business’s success, it is imperative that your business sees profits and growth.
The E-2 Visa is given under the assumption that you are investing a great amount of capital into the business, and that you will see long-term success with enough profits to support yourself and your family solely from the business. It also requires a highly structured business plan yielding proof of profitability. Extending this Visa has no limits and simply requires reapplication and approval.
Keep in mind, though, that this is just one example and is not the only option. Many people are not comfortable applying for the E-2 Visa since it’s contingent on the success of the business. If anything were to happen to the business (for example, it fails), then the family would no longer have permission to stay in the country. Applying for a green card or another visa route might be the best option for you.
The L1-A Visa is another option that is particularly beneficial for those who have a pre-existing business and plan to move themself (and their families) or another executive in the business to the United States permanently. This requires previous business experience, so you will need to be sure that you have a record of your current business’s success and can verify the interest in moving someone (on behalf of the business) to the U.S. to begin trading and profitability in the country.
Green cards can be hard to come by, though, as their application process can take months to years to receive. Building a strong case for residency is important if you choose to go this route. You will need to prove that you are invested in the country financially and otherwise. Likely, you will not be permitted to leave the country for a certain period during your application process or you will jeopardize your filing status.
Be sure to review the legal requirements depending on your situation (especially if you are also attempting to move your family to the U.S.). There are numerous options to make this happen for you and your business legally, but it will likely take lots of research and patience to navigate the process and get your business up and running effectively in the U.S.
Non-Citizen Starting a Business in the USA While Residing Guidelines
If you are a non-citizen planning to start a business in the USA while you live and work there, but you do not currently have citizenship status, then there are several legal precautions that you will need to take. While anyone (citizen or not) can start a business in the U.S., working in and living in the U.S. requires additional documentation.
Before you start a business in the USA as a non-citizen residing in the country, be sure to do the following:
- Have a well-thought-out business plan.
- Verify your source of initial capital.
- Choose your desired length of stay in the U.S.
- Consider any immediate family whom you would like to have join you.
- Select the type of business entity that you will register your business as.
- Verify all legal documentation and living situations ahead of time.
- Work with an attorney to ensure that you file correctly.
While this is not an exhaustive list, this can give you a good place to start. You are brave for venturing to a new country, potentially uprooting your family (along with yourself) to start a new business and life in the U.S. Know that while this can be an extremely intimidating process for those who are unfamiliar with the ins and outs, it can be done successfully, and you can reach the goals that you desire to achieve.
Through exploring online communities and groups, you can even find people and communities that have done this same venture successfully before. By learning from other people’s experiences, you can be sure to watch out for areas of success and failure in navigating the legal process as well as helping your U.S.-based business to succeed long-term.
Foreigner (Non-Resident) Starting a Business in the USA Guidelines
If you are a foreigner (non-resident) planning to start a business in the USA but do not plan on residing there, then there are plenty of legal ramifications for this, as well. Since you do not have to be a citizen or reside in the U.S. to start a business there, this aspect should be no problem. But, you will need to be sure that you follow the appropriate legal measures for receiving wages and paying the appropriate taxes and fees abroad.
Before you start a business in the USA as a foreigner (non-resident) who lives abroad, be sure to do the following:
- Create a structured business plan.
- Verify your source of capital and potential for trade.
- Search for the appropriate tax documentation that you will need to file (annually).
- Select the appropriate business entity to register your business.
- Verify and file taxation appropriately while living abroad.
- Work with a U.S.-based attorney to ensure that your U.S.-based business is secure and legally operating.
✔ Check Out These 30 Best Business Ideas for the USA
Again, while this is not an exhaustive list for starting a business in the U.S. as a foreigner (non-resident) while not living there, or attempting to live there, this can give you a place to start. Navigating the legal process in this arena can be difficult and intimidating. Especially if you are having to work from across the world, likely experiencing the difficulties of working in time zone differences (along with cultural differences), this is no easy feat.
But, try to keep in mind that others have done this before, which means that if you are driven and have a well-planned business, you can make this dream of yours come true, too. This does not guarantee that the journey will necessarily be easy, or that you will not face problems along the way, but you are capable and can make this entrepreneurial journey successfully while starting a business in the USA as a non-citizen foreigner and continuing to live in your home (or other) country.
Check out our huge list of small business ideas for your entrepreneurial inspiration.
Are you thinking about starting a small business in Canada?
If so, you’re not alone. In fact, according to the Canadian Federation of Independent Business (CFIB), more than half of all Canadians are either currently self-employed or want to be. But before you start your own business, it’s important to know what it takes and how much it costs.
Click here now for more information on How Much it Costs to Start a Small Business in Canada!
Disclaimer: The content on this page is for informational purposes only, and does not constitute legal, tax, or accounting advice. If you have specific questions about any of these topics, seek the counsel of a licensed professional.
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