How to Form a US LLC from India
Forming a US Limited Liability Company (LLC) gives Indian businesses access to the US market, Stripe Atlas or similar payment processors, and a globally credible corporate identity — without requiring physical presence. Delaware and Wyoming are the most popular states for non-resident formations.
Before you start
- Passport (valid ≥6 months) of each member/owner
- Foreign address proof (utility bill or bank statement)
- ITIN or SSN (for EIN application — or you can get an EIN via SS-4 phone application without ITIN)
- Business purpose statement
- FEMA compliance plan for ODI/LRS reporting to RBI (for Indian residents)
Step-by-step
Choose the State of Formation
Delaware is preferred for VC-backed startups (well-established case law, no state corporate income tax on out-of-state income). Wyoming is better for single-member LLCs with privacy requirements and zero state income tax. If you will have a physical US presence, incorporate in that state to avoid foreign qualification fees.
Select and Appoint a Registered Agent
Every US LLC must maintain a Registered Agent with a physical US address in the state of formation, available during business hours to receive legal notices. Services like Northwest Registered Agent, ZenBusiness, or Incfile typically cost $50–$150 per year.
File Articles of Organization
File the Articles of Organization (or Certificate of Formation in Delaware) with the state's Secretary of State. This can be done online. Delaware filing fee is $90; Wyoming is $100. The state typically processes the filing in 1–5 business days (expedited options available).
Obtain an EIN (Employer Identification Number)
An EIN is the US tax ID for your LLC. Non-residents without an SSN/ITIN must apply by faxing Form SS-4 to the IRS or calling the IRS International line (+1 267-941-1099). Processing takes 1–4 weeks by fax; the phone call can get an EIN the same day.
Draft the LLC Operating Agreement
Draft an LLC Operating Agreement setting out membership interests, voting rights, profit distribution, and management structure (member-managed vs manager-managed). Even if you are a single-member LLC, a written agreement is important for banking and legal protection.
Open a US Business Bank Account and Comply with FEMA
Open a US bank account (Mercury, Relay, or traditional banks if you visit in person). As an Indian resident, your investment in the US LLC must be reported to the RBI under the Overseas Direct Investment (ODI) route — file Form ODI with your AD bank. LRS (Liberalised Remittance Scheme) applies for amounts up to $250,000 per financial year.
Common mistakes to avoid
- Ignoring FEMA/RBI ODI reporting — Indian residents who own foreign entities must report within 30 days of investment; non-compliance is a FEMA violation with compounding penalties.
- Forming in Delaware or Wyoming but operating entirely in another US state — you may need to 'foreign qualify' in that state, paying double annual fees.
- Treating a single-member LLC as invisible for US taxes — a single-member LLC owned by a non-resident is a 'disregarded entity' for the IRS but the owner still has US tax filing obligations on US-source income.
- Not maintaining a Registered Agent — a lapsed registered agent can result in the LLC being administratively dissolved by the state.
Frequently asked questions
Does a US LLC pay taxes in the US if all its clients are outside the US?
A non-resident-owned LLC with no US-source income and no US trade or business is generally not subject to US federal income tax. However, the LLC must file Form 5472 (information return) annually if it has any US transactions, even non-taxable ones.
Can I open a US bank account without travelling to the US?
Yes, with neobanks like Mercury, Relay, or Brex, you can open an account entirely online without visiting the US. Traditional banks (Chase, BoA) typically require an in-person visit for non-residents.
What is the difference between an LLC and a C-Corp for Indian founders?
An LLC is simpler, avoids double taxation (profits flow through to members), but is not ideal for VC investment (most US VCs prefer C-Corps with standard equity structures). A Delaware C-Corp is the standard for VC-backed startups; an LLC suits freelancers and non-VC businesses.
How does LRS apply to remitting money to a US LLC?
Under the Liberalised Remittance Scheme, Indian resident individuals can remit up to $250,000 per financial year for permitted capital account transactions including overseas direct investment in foreign entities (subject to ODI compliance). Amounts above $250,000 require specific RBI approval.
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