If you live outside the United States and own a single-member US LLC, there is one federal filing you cannot skip: Form 5472 attached to a pro forma Form 1120. It applies even when the LLC made no money and owes no US tax. This guide explains what the form is, who must file, what goes on it and how to avoid the penalty.
What is Form 5472?
Form 5472 is an IRS information return. It does not calculate tax. Its job is to show the IRS the money and property moving between a US company and the people or companies related to it, especially foreign owners.
For many years the form applied mainly to corporations. Then the IRS changed the rules: for tax years beginning on or after January 1, 2017, a foreign-owned US disregarded entity is treated as a corporation for this reporting. In plain words, a single-member LLC owned by a non-US person must file Form 5472, even though the LLC itself is “disregarded” for income tax.
Who must file?
You need to file if all of these are true:
- Your LLC was formed in a US state (Wyoming, Delaware, New Mexico or any other state).
- It has a single owner, and that owner is a foreign person (a non-resident individual or a foreign company).
- It has not elected to be taxed as a corporation (it is a disregarded entity).
- It had at least one “reportable transaction” with its owner or another related party during the year.
The last point catches almost everyone. As the next section shows, simply putting money into the LLC or taking money out counts.
A multi-member LLC is usually taxed as a partnership and files Form 1065 instead. An LLC that elected corporate tax treatment files a full Form 1120. See our tax filing services for those cases.
What counts as a reportable transaction?
The IRS instructions are broad. For a foreign-owned disregarded entity, reportable transactions include amounts paid or received in connection with the formation, dissolution, acquisition or disposition of the LLC, including contributions to and distributions from the entity. Common examples:
- Paying the state filing fee or registered agent fee from your personal card for the LLC (a contribution).
- Sending your own money to the LLC’s bank account to start the business (a contribution).
- Moving profit from the LLC’s account to your personal account (a distribution).
- The LLC paying you for services, renting something from you, or lending you money.
Because forming and funding the LLC is itself reportable, a brand-new LLC with no sales usually still has to file for its first year.
What exactly do you file?
You file a pro forma Form 1120 with Form 5472 attached. “Pro forma” means the Form 1120 is only a cover sheet. According to the IRS instructions, you complete only the name and address and items B and E on page 1, and write “Foreign-owned U.S. DE” across the top.
On Form 5472 you report:
- The LLC’s details, including its EIN.
- Details of the foreign owner (direct and ultimate). If the owner has a foreign tax identification number (FTIN), it must be entered; if none exists, you write “None” or “N/A”.
- The amounts of each type of reportable transaction during the year.
The LLC needs an EIN before it can file. If you don’t have one yet, see our EIN application service; you don’t need an SSN or ITIN to get one.
How to file: no e-filing
A foreign-owned US disregarded entity cannot e-file Form 5472. The IRS instructions give two options:
- Fax to 855-887-7737 (at 300 DPI or higher), or
- Mail to: Internal Revenue Service, 1973 Rulon White Blvd, M/S 6112, Attn: PIN Unit, Ogden, UT 84201.
Do not send it to the normal Form 1120 address. Keep the fax confirmation or a tracked mailing receipt as proof of filing.
Deadlines and extensions
For an LLC on the calendar year, the pro forma Form 1120 and Form 5472 are due on April 15 of the following year. If you need more time, file Form 7004 by the original due date; that extends the deadline by six months, to October 15. The extension is filed by fax or mail to the same fax number and address as above.
Dates fall on the next business day when the 15th is a weekend or holiday. We check the exact dates each January.
The $25,000 penalty
This is why Form 5472 matters. The IRS can charge $25,000 for each failure to file on time, to file in the prescribed manner, or to keep the required records. A substantially incomplete form counts as not filed. If the failure continues more than 90 days after the IRS notifies you, an additional $25,000 can apply for each 30-day period (or part of one).
The penalty is the same whether your LLC earned $0 or $1 million. That is why we treat Form 5472 as the most important yearly deadline for foreign-owned LLCs.
Records you must keep
The LLC must keep books and records that support what you report: bank statements, invoices, receipts and a record of every transfer between you and the company. Our free US business records guide lists what to keep and for how long. If your records are messy, our bookkeeping service can put them in order before filing.
Form 5472 is federal only
Form 5472 does not replace your state obligations. Many states also require an annual report or a yearly tax (for example, Wyoming’s annual report or Delaware’s annual LLC tax). Compare them with our LLC state fee calculator, or let us handle it with our annual report filing.
Common Form 5472 mistakes
- Thinking “no income” means “no filing”. The filing requirement comes from reportable transactions, not profit. Money you put in to pay formation costs is already reportable.
- Sending it to the wrong place. The pro forma 1120 for a foreign-owned disregarded entity goes to the special fax number or Ogden address, not the regular Form 1120 address.
- Leaving out the owner’s details. The foreign owner’s name, address, country and foreign tax ID (or “None”) must be complete. A substantially incomplete form is treated as not filed.
- Reporting only bank transfers. Expenses you paid personally for the LLC, such as software subscriptions or the registered agent fee, are also related-party transactions.
- Forgetting the first year. The first filing is due for the year the LLC was formed, even if it was formed in December.
- No proof of filing. Keep the fax confirmation page or tracked mail receipt with a copy of what you sent.
What if you missed earlier years?
If your LLC should have filed for past years and didn’t, don’t wait for an IRS letter. Gather the bank statements for each missing year, work out the related-party transactions and file the missing returns as soon as possible. Each late year is a separate return. Whether penalty relief is available depends on your facts, so for serious cases speak to a US tax professional. We prepare late-year Form 5472 and pro forma 1120 filings for $299 per year.
A simple yearly checklist
- Keep the LLC’s bank statements and a list of every transfer to or from you.
- In January, total your contributions, distributions and other related-party payments for last year.
- Prepare the pro forma Form 1120 and Form 5472 (or file Form 7004 for an extension).
- Fax or mail the forms to the IRS address above and keep proof.
- File your state annual report or tax, if your state requires one.
Ze Filing prepares and files Form 5472 with a pro forma 1120 from $149 (no activity) or $249 (active LLC). See all prices on our pricing page.