Establishing a business company in the USA is a wonderful opportunity for expanding your business. The American market is huge and besides, you can qualify for a business visa that can later be turned into a green card. Thus, registering a company in the States can be the first step towards immigrating to the country.
The US legislation allows foreign nationals to register companies in the country and engage in business operations. You don’t have to permanently live in the USA to be a business owner there. However, each state will have its own regulations concerning foreign companies established on its territory.
Advantages that a foreigner can find when registering company in the USA
The main advantages that you will find if you establish a business company in America include the following ones:
- A strong international reputation and a favorable business environment;
- Access to huge new markets;
- A wide network of trade agreements that the USA has signed with other countries;
- Access to advanced technologies: the USA is famous for its technological progress and many foreigners open companies in the country with the intention to make full use of modern technologies;
- Global communication networks;
- Advanced transportation opportunities: railroad and highway networks, air and sea ports;
- Incentives for entrepreneurs from federal, state, and municipal authorities;
- Many states especially welcome foreigners who start business companies there;
- Availability of qualified personnel;
- Wonderful education opportunities.
How to register a company in the USA: the main steps in the process
1. Choose the state where you would like your company to be registered.
Every state will have its own corporate regulations and its own tax system. The cost of company registration can also be different. This is why you have to choose the state carefully: a comparative analysis will be helpful.
Your choice will largely depend on the physical presence that your company is going to have in the state. Are you planning to rent a company office or a warehouse or retail space? Are you planning to hire local personnel? Besides, each state will offer some special advantages to companies engaged in certain spheres of business. California, for instance, is famous for its Silicon Valley where lots of IT and high-tech companies are stationed. The costs of company registration and maintenance are also of importance. Find out how much you would have to pay in state duties and annual fees. Finally, find out what taxes you would have to pay if you establish a company in a particular American state. Some professional advice would be helpful in choosing the state.
2. Choose the form of company ownership.
A vast majority of foreigners opt for C-Corporations or LLCs when registering companies in America. A combination of two factors make these forms of company ownership so popular: a) they provide limited liability and b) they can be owned by foreigners in accordance with the law.
Limited Liability Company (LLC)
LLC formation in the USA makes good sense if the number of foreign company founders is small. Many states allow a single person to be the LLC owner. Some key characteristics of USA-registered LLCs include the following ones:
- The company does not issue ownership shares; it cannot become a public company.
- The company owners are free to distribute the profits in any way they like.
- Reports are filed online once a year.
- A mid- or large-size company.
- The company is owned by shareholders.
- A Corporation has a more complex legal organization in comparison to an LLC. It has to have a President, a Board of Directors, and company officers. In some states, it is possible to set up a Corporation with a single shareholder and a single Director.
- The company can go public.
3. Think up 3 variants of the company name.
Why do you need three variants? Because if the Registrar says that one of the names is no good (a company has already been registered under this name), you have to spare names.
The company name has to meet the following requirements:
It has to be 100% unique;
It has to be easily readable;
The company name shall not mislead the customer.
4. Draw up a company Charter or an Operational Agreement.
Corporations need Charters that serve and their basic documents. LLC founders make operational agreements even though this is not mandatory in some American states.
5. Register the company in the chosen state.
The list of application documents as well as company registration procedures will be different depending on the state. In Nevada, for example, you have to supply a ‘List of Officers’ – a document that lists the names of company Directors and top managers. In that state, you have to do it prior to registering the company. In California, this document is called ‘Statement of Information’ and it has to be submitted after the company has been registered.
In some states (Arizona, Nebraska, and New York), you have to publish a notice of LLC formation in a newspaper. You also have to supply proof of publication to the State Department within 120 days. In Arizona, Georgia, Nebraska, and Pennsylvania, a notice of Corporation formation has to be published.
Please note that whether you want to register a company in the USA remotely or on site, you will need a registration agent. Without an agent, you will not be able to obtain a single official document from the government bodies.
6. Acquire an Employer Identification Number.
Employer Identification Number is basically your tax number. Acquiring it allows you to do the following:
- Open a bank account in the USA;
- Hire staff;
- Submit tax returns to the (IRS);
- Apply for licenses, permits, trademark registration, and so on.
7. Open a corporate bank account in the USA.
The last step is the most challenging one. Banks in America are often reluctant to open personal and corporate accounts for foreigners. Please note that you can ally for banking services only after you have registered the company and obtained an EIN.
Over the last few years, the Government of the United States has been tightening the screws on banks. They have to follow the ‘Know Your Client’ requirements to the letter. Client identification procedures require that foreign applicants for banking services visit the bank office in person.
Registering a company in the USA will also make you qualified for short-term B1/ B2 visas, for an L1 (company personnel relocation) visa, an E2 (company management) visa, or an EB5 visa that is a long-term visa issued to foreign investors. Therefore, you can eventually acquire permanent legal residence in the USA if you open a business company there.