About the USA

The United States of America is a country of great opportunities and prospects. The perfect combination of economic strength, internal privacy, and a preferential tax system. America annually enters the top ten countries for starting a business, owns a global domestic market and extensive trade routes, and most importantly, concentrates many foreign investors on the mainland and, as a result, start-ups..

In order to register a business in the USA, it is important to familiarize yourself with all the requirements of national legislation, choose the most advantageous state and form for creating a company, and also understand what responsibilities are assigned to legal entities in America.

As you know, there are 50 autonomous states in the USA, each of which has its own characteristics. From the point of view of the profitability of building an international business, such states as Wyoming, Delaware, and Florida stand out. It is in these regions that there is a favorable economic and tax climate for non-residents and simple requirements for the ownership and structure of companies.

US ADVANTAGES

The USA is a favorable jurisdiction for such areas as E-commerce, IT, consulting, digital industry, design, and trading companies
High level of confidentiality, the USA does not participate in the exchange of information CRS
Legal system which is developing and provides reliable business protection
Wide sales network and large-scale sales market within America
Strong and stable economy of the world's leading superpower
A clear and transparent corporate governance system for the company
Opportunity to attract investments
Possibility of optimal taxation (while working not offshore)
Convenient work with marketplaces
Developed banking infrastructure

LEGISLATION

The United States has legislation at the federal level that applies throughout the United States and at the level of each individual state. Thus, each state has its own constitution, legislative, executive and judicial powers. Before opening a company in America, it is important to study the legislation of the specific state in which you plan to register a business in the USA.

For example, the creation and operation of companies in the state of Wyoming are governed by the Wyoming Limited Liability Company Act, in Delaware by its Delaware Limited Liability Company Act, and in Florida by its Florida Business Corporation Act.

COMPANY TYPES

For doing business in the US by non-residents, the most common forms of companies are:

LLC (Limited Liability Company);
Corp (Corporation).

LLC in the USA is considered a unique hybrid form of company that combines the features of a corporation and a private entrepreneur. Suitable for opening a company in the USA for a non-resident for small and medium-sized businesses.

The most common types of Corporations are C-corporations and S-corporations. S-corporations have a limit on the number of shareholders and requirements for their residence in the United States. Therefore, to register a company in the United States by a non-resident for large businesses and attracting investments, the C-corporations form is used.

REQUIREMENTS FOR FORMS OF COMPANIES

REGISTRATION LLC IN USA

Minimum authorized capital – not established, there are no deposit requirements.
LLC operates on the basis of an operating agreement, the complexity of which depends solely on the wishes of the founders of the company. The company can be managed by its founders or a manager hired for this purpose.
Founders - at least one participant is an individual or legal entity, there are no residency requirements. A company with one member can be recognized as a sole proprietorship with appropriate individual taxation (personal income tax applies).
Manager - appointed to manage the company, maybe a legal or natural person. US residency is not required.
Shares of ownership - determined solely by the agreement of the founders (Operating Agreement). Voting and non-voting shares are allowed.
Secretary - not required.
Confidential information - data on beneficial owners is not publicly available.
Reporting - annual financial statements are filed, in some cases LLC members also file reports.
Office - a registered agent and a legal office in the United States are required.

REGISTRATION OF C-CORP IN THE USA

Minimum authorized capital – not established, formed by issuing shares.
Shares - different types and classes of shares are available.
Shareholders – at least one participant, a natural or legal person. The number and residency of shareholders are not limited. Easy change of shareholders is possible. If a shareholder leaves the company or sells his shares, Corporation C can continue to do business.
Board of Directors - appointed by shareholders to manage the company. Responsible for setting the strategic direction of the company, as well as hiring its day-to-day managers and officers, which must include at least the president and secretary.
Management - selected by the Board of Directors to perform day-to-day tasks (positions such as manager, secretary, etc. are appointed).
Meetings of shareholders - the board of directors must hold meetings, which must be recorded in minutes. The legislation requires shareholders and the board of directors to hold at least one meeting per year.
C-corporation must appoint a resident agent who will be responsible for representing the interests of the company in the event of litigation.
Confidential information - data on beneficial owners is not publicly available.
Reporting - annual preparation and submission of the financial report (annual tax report) are required.
Office - you must have a registered agent and a legal office in the United States.
C-corporation pays its own tax on its profits. Additional tax deductions are possible.
Corporations provide the best protection for their owners from personal liability.

TAXATION

The United States has a fairly complex and multi-stage tax system. Taxes are paid at the federal, state, and local levels. Each state sets additional tax rates, which are often added to the federal rate.

In the USA, there are three main types of taxation regarding the income of companies: on the principle of "fiscal transparency", like C-Corporation or S-Corporation.

Taxation based on the principle of "fiscal transparency": taxes on the company's income are paid by the founders of the company, and not by the company itself. This is the case for all LLCs unless they elect to be taxed as a Corporation.

In this case, federal personal income tax rates apply.

At the federal level: Individual income tax rates are determined on a progressive scale: from 10% to 37%, depending on the amount of annual income.

All rates are applied based on taxable income, not necessarily the actual amount of money earned in a given year. Much depends on whether the tax return is filed alone or with a second family member (spouse/husband). It is also possible to take into account various benefits and deductible expenses.

Statewide: In addition to the federal rate, each state sets its own personal income tax rates.

Taxation by Corporation type

All Corporations and LLCs that choose to be taxed under the Corporation type pay corporate income tax. Again, there are three levels of US taxation to consider.

At the federal level: the corporate income tax rate is 21%.

State taxes:

Type of tax\state	Wyoming	Delaware	Florida
Company income tax	0%	8,7%	5,5%
Sales tax (similar to VAT)	4%	0%	6%
Franchising Tax	50 USD/year	to 250 USD/year	no

If the company does not do business in the US and does not have a source of income in the US. In such a case, the company may choose to be taxed as an S-Corp and not pay US income tax.

The United States also has a sales tax. This is an indirect tax, the rates of which are determined at the state level and depend on the specific states where goods are sold or services are provided. Sales tax rates range from 2.9% to 7.25% at the state level. In addition to the state rate, local governments in 35 states charge an additional sales tax ranging from 1% to 5%.

Every company that sells goods and/or services subject to sales tax and exceeds state thresholds must register for sales tax in the state in which it sells goods and/or provides services. Typically, these are economic thresholds, such as annual sales or a number of transactions (for example, more than $100,000 (USD) in sales in a state or more than 200 transactions in a state).

Franchise tax - a special tax that is levied on a company at the state level where it is registered. The purpose of this tax is to confirm the right of the company to exist as a legal entity and conduct business in the territory of a particular state.

Franchise tax is introduced in 13 states and Washington, DC, and its calculation varies from state to state. The tax rate can be fixed or calculated based on the net worth of the taxpaying company (as a percentage). For example, in Delaware, the minimum franchise tax is $175.00 and the maximum is $250,000.00. Payment of franchise tax does not depend on whether the company generates profit.

CURRENCY CONTROL

Absent.

DOUBLE TAX TREATIES

The states have signed about 60 double tax treaties, including with Ukraine.

Under these treaties, residents (not necessarily citizens) of foreign countries are subject to a reduced rate or exemption from US taxes on passive income they receive from US sources. These reduced rates and exemptions vary by country and specific types of income.

PECULIARITIES

Opening a company in the USA is a decision that will definitely bear fruit, but before you rush to register a business, you should remember the difference in state laws (Delaware, Wyoming, Florida and others) and take into account the peculiarities of local legislation. Each state has its own advantages and can be beneficial for certain types of activities. To find out which activity will be more profitable in a particular state, use the individual advice of our specialists.

If you are planning to open a company in the USA or register a company in America for a non-resident, please contact us: +38 (098) 737-88-88

We will help you register a company in the USA (Delaware, Wyoming) or any other jurisdiction of your choice. The cost of registering a company in the USA is formed individually for each client and depends on the set of selected services, so get the final price in our commercial offer after consulting with a lawyer.

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