Form 5472
Reportable transactions disclosed.
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A single-member LLC owned from Pakistan often owes no US income tax, but it still has an annual federal filing: Form 5472 with a pro forma Form 1120. The penalty for missing it is $25,000. We prepare the federal and state filings for foreign-owned LLCs, keep the records the IRS requires and make sure the income is reported correctly at home.
A US LLC with one owner is a disregarded entity for income tax, so it does not usually file its own income tax return. But since 2017, a disregarded LLC wholly owned by a foreign person is treated as a corporation for reporting purposes and must file Form 5472, attached to a pro forma Form 1120, every year.
Form 5472 reports reportable transactions between the LLC and its foreign owner or other related parties. For foreign-owned disregarded entities, these include money the owner puts in, money taken out, loans, and payments for services or expenses. The return is due on the corporate deadline, 15 April for a calendar-year LLC, with a six-month extension available on Form 7004. The penalty for failing to file, or for filing an incomplete form, is $25,000 per form, with further penalties if failure continues after an IRS notice. The LLC must also keep records sufficient to support the form.
Whether the LLC owes US income tax depends on its activity. If the owner is a non-resident and the LLC has no income effectively connected with a US trade or business, for example a Pakistani IT freelancer whose work is performed in Pakistan, there may be no US income tax. If the LLC has US employees, an office, inventory in US warehouses or dependent agents in the US, it may have effectively connected income, and the owner then files Form 1040-NR. We review the facts each year rather than assume the answer.
An LLC with two or more owners is a partnership by default and files Form 1065, and any LLC can elect to be taxed as a corporation using Form 8832. The state where the LLC is formed, such as Wyoming, Delaware or New Mexico, will have its own annual report or tax. And because a Pakistani resident is taxed on worldwide income, the LLC's profits must also be reported in the Pakistani return, where foreign income and remittance rules apply.
See also US EIN assistance, US state tax filing and US non-resident tax services. For the Pakistani return, see individual tax return filing.
A fixed annual fee for each LLC.
Reportable transactions disclosed.
Prepared and attached.
Form 7004 filed in time.
Whether US income tax applies.
Form 1065 and K-1s.
Form 8832 elections reviewed.
Wyoming, Delaware and others.
LLC income in your return.
These are the most expensive.
Penalty of $25,000 per form.
We file every year.Owner contributions and withdrawals left out.
We review the bank records.Form cannot be filed.
We obtain the EIN.Effectively connected income.
We review the facts yearly.LLC dissolved by the state.
We track state deadlines.LLC profits missing from the Pakistani return.
We report them correctly.Every year, before the April deadline.
Owners, activity and history.
Agreed per LLC per year.
Bank statements and transactions.
5472, pro forma 1120 and state reports.
Filed or extended on time.
Using a US LLC for clients.
US LLCs owned from abroad.
Selling to US customers.
Partners in several countries.
UAE and Saudi residents.
Missed 5472s from earlier years.
US and Pakistani filings for the same income, handled together.
A core service, not an add-on.
ACCA and ICAP Chartered Accountant qualifications and an FBR-registered income tax practitioner.
LLC income reported in Pakistan.
ECI checked every year.
Easy contact from anywhere.
Per LLC per year.
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Tell us about your LLC, its owners and its activity. We will confirm your filings and quote a fixed annual fee.
Book your free consultationThis page is general information about our services, not tax, legal or financial advice for your specific situation. Laws, rates and deadlines change with each Finance Act and official notification.