The US LLC is one of the most popular company forms in the world. There are reasons for that. If you work internationally or want to bundle digital products, SaaS, consulting or trading, a US LLC can fit well into your structure. But one point is decisive: how your country of residence treats the LLC for tax and legal purposes. That is exactly what we at Danho & Partner clarify with you from the very beginning.
The LLC is a flexible US company form. It combines two things: limited liability and tax transparency. The owners (the 'members') are generally not liable for the company's debts with their private assets. For tax purposes, a single-member LLC is normally treated in the US as a 'disregarded entity'. That means: the profit flows directly through to the member. The LLC itself pays no corporate income tax in the US as long as it generates no US income.
Unlike a German GmbH, an LLC requires no minimum capital and no notary. And in many states, the ongoing administrative burden is considerably leaner than under German company law.
Two states are chosen particularly often by non-US citizens: Wyoming and New Mexico. The reason is not anonymity in the sense of concealment. It is about a legitimate privacy advantage: neither state requires the names of the members to appear publicly in the company register. The names of the owners therefore do not show up in publicly accessible databases. In Delaware and some other states, this is different.
In concrete terms: competitors, business partners or the public cannot simply read the ownership structure from a public register. This is a legitimate privacy interest, and US law expressly permits it.
Important: This advantage only concerns the public registration in the US. Towards the tax authorities in Germany, Austria and Switzerland and under the automatic exchange of information (CRS/AEOI), your reporting obligations continue to apply in full. More on this in the section on tax classification.
Wyoming LLC, key features at a glance:
New Mexico LLC, key features at a glance:
A US LLC can be used for many legitimate purposes. Whether it makes sense in a specific case always depends on your existing structure and your tax residence. These are the use cases we see most often in our advisory work:
Without a US business account, a US LLC is of little practical use to you. We work with a tiered model that has proven itself: you start with a quickly available online account and later build a traditional US bank account and access to the US credit system on top of it. You open all of the following providers remotely, without any trip to the US.
For DACH entrepreneurs, Wise and Airwallex are usually the first choice. Opening is simple and fast, and European payment transactions run directly:
To open an account, you generally need an EIN (Employer Identification Number). It can also be applied for without a US tax number (SSN). We guide you through selection and opening. You will find further options for company accounts under company bank account.
You should read this section before you decide.
Tax disclaimer: required reading
If your tax residence is in Germany, Austria or Switzerland, a US LLC does not automatically bring a tax advantage. You must review these points without fail:
- Transparency principle (Germany): German tax law often treats a US LLC as a fiscally transparent company. That means: the profit is attributed directly to the German member and is subject to income tax in Germany, whether it is distributed or not.
- CRS/AEOI (automatic exchange of information): The US does not participate in the OECD's Common Reporting Standard (CRS). Via FATCA, however, it exchanges information with the DACH countries. This largely closes the information gap.
- Permanent establishment risk: If you effectively manage the LLC from Germany, Austria or Switzerland, a permanent establishment can arise there. The consequence: full tax liability in your country of residence.
- Transparency register / beneficial owners: In Germany, Austria and Switzerland you must report the beneficial owners of foreign companies.
- Notification obligation under § 138 AO (Germany): Anyone who, as a German taxpayer, acquires shareholdings in foreign companies must report this under § 138 para. 2 AO.
This page does not replace tax advice. Before forming a company, be sure to obtain a qualified tax review in your country of residence. Danho & Partner guides you through international structuring and coordinates with your local tax advisor where needed.
Whether a US LLC brings any tax benefit depends above all on one thing: your tax residence. This is the most important point on this page.
Residence in Germany, Austria or Switzerland: Here the benefit is limited. Anyone living in the DACH region must report the US LLC and pays tax on the profits in their country of residence (transparency principle). Without an accompanying structure, the US LLC brings you no tax advantage in this case. We tell you that openly.
Residence in a country without income tax, for example the UAE: Things look completely different if you move your centre of life to a country without income tax. Then you can receive the profits of the US LLC tax-free at member level. This is exactly where the real leverage lies. The combination of UAE residence and US LLC is one of our core topics. The route there leads via a free zone company and the right residency in the UAE.
Location-independent living without a fixed tax residence: Even if you live location-independently and have no fixed tax residence, a largely tax-free arrangement may be possible. But several things have to be right for that: your previous tax liability must be cleanly ended, you must not establish a new residence or permanent establishment, and you must observe after-effects such as the extended limited tax liability (§ 2 AStG). To say flatly that this is tax-free would be unserious. Whether and how this works in your case is something we review individually in the initial consultation.
Step 1: initial consultation and situation analysis
We look at your existing structure, your tax residence and your goals. Only then do we tell you whether and in what form a US LLC makes sense for you.
Step 2: state and formation structure
Based on your situation, we choose the right state (Wyoming, New Mexico or another) and clarify the registered agent, operating agreement and ownership arrangement.
Step 3: formation and EIN application
We take care of filing the Articles of Organization with the Secretary of State and apply for the Employer Identification Number (EIN) with the IRS. You do not have to travel to the US for this.
Step 4: bank account and infrastructure
On request, we guide you through selecting and opening a US business account and building the further infrastructure.
Step 5: ongoing compliance
We remind you of annual obligations (annual reports, renewal fees) and are there for follow-up questions.
Timeline (expectation management):
From engagement to a ready-to-use account, that is typically around 3 weeks.
What your structure looks like in detail (state of formation, banking setup, ongoing compliance) is something we discuss individually in the free initial consultation. That way you get an assessment that fits your case, instead of a blanket figure.
Hannes Danho has been advising DACH entrepreneurs on international corporate structures for more than seven years, in German, English, Arabic and Aramaic. Danho & Partner is based in the DIFC Dubai (Gate Village 3), one of the leading international financial centres, and knows the specific requirements of German-speaking clients.
We do not work with templates. We look at your situation and recommend only what really makes sense for you. Even if that means advising you against a US LLC.
Can I form a US LLC as a non-US citizen?
Yes. US law allows non-US citizens and non-residents to form an LLC. You need no visa, no green card and no US address. All that is required is a registered agent with a US address in the state of formation.
What does 'anonymous' really mean for a Wyoming or New Mexico LLC?
In Wyoming and New Mexico, the names of the members do not appear in the publicly accessible company register. That is legitimate privacy towards third parties. It does not mean, however, that the tax authorities in Germany, Austria or Switzerland learn nothing about the company. Your reporting obligations there continue to apply in full.
Do I have to report my US LLC to the German tax office?
Yes. In Germany, you must report the acquisition of shareholdings in foreign companies under § 138 para. 2 AO. In addition, the profit of a US LLC, as a transparent company, is often attributed directly to the German shareholder and is taxable in Germany. Individual tax advice in your country of residence is essential.
Which state is best for my US LLC?
That depends on your situation. Wyoming and New Mexico offer privacy advantages and lean administration. Delaware is mainly of interest to institutional investors and venture capital structures. For most DACH entrepreneurs without their own US operations, we recommend Wyoming or New Mexico, after individual analysis.
Can I open a US business account with a US LLC?
Yes, with some preparation. Traditional large US banks often require physical presence. Fintech providers such as Mercury, on the other hand, open accounts remotely, including for foreign LLC owners. An EIN (Employer Identification Number) is always a prerequisite. We guide you through this process.
How long does it take to form a US LLC?
The LLC is usually in place within around 2 business days. The EIN arrives in about 14 days, and account opening usually takes 2 to 4 business days. From engagement to a ready-to-use account, that is typically around 3 weeks.
Tax and legal notice
The information on this page serves general guidance only and does not constitute tax, legal or financial advice. Every corporate structure is individual. Above all, the tax consequences of a US LLC for persons resident in Germany, Austria or Switzerland vary considerably depending on the personal situation.
Persons with tax residence in DACH countries should clarify the following points with a qualified tax advisor in their country of residence before forming a US LLC:
- Tax transparency of the LLC under national law
- Reporting obligations (§ 138 AO for Germany, corresponding rules in AT/CH)
- Permanent establishment risk if managed from the country of residence
- Applicability of the automatic exchange of information (FATCA / CRS)
- CFC taxation (§§ 7 ff. AStG, where applicable)
Danho & Partner Wirtschaftskanzlei LLC-FZ is not a tax advisory firm under German, Austrian or Swiss law. We provide international advice on corporate structures and coordinate with your local advisors where needed.
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