The National Directory of Certified Public Accountants

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What Are The Requirements For Foreign Ownership Of A U.S. Company ?

Generally, there are no restrictions on foreign ownership of a company formed in the U.S. The procedure for a foreign citizen to form a company in the United States is the same as for a U.S. resident. It is not necessary to be a U.S. citizen or to have a green card to own a corporation or limited liability company formed in the United States. To receive the pass through profit distributions, a foreign citizen may form a limited liability company. In contrast, all profit distributions which are called dividends made by a C corporation are subject to "double taxation". under U.S. tax law as of 1/1/2001, a nonresident alien may own shares in a C corporation, but may not own any shares in an S corporation. For this reason, many foreign citizens form a limited liability company instead of a C corporation. A foreign citizen may be a corporate officer and director, but may not work in the U.S. or receive a salary or compensation for services provided in the U.S. unless the foreign citizen has a work permit (either a green card or a special visa) issued by the U.S. Some work permits allow a foreign citizen to work only for a sponsoring employer. Such work permits generally do not enable a foreign citizen to also work for a new, unrelated company formed by the foreign citizen. The foreign citizen would need to obtain a separate work permit to work for the new company.

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