I have several Indian clients who are engaged in similar activities and
would be happy to speak with you. We provide a "turnkey" structure to
make the task as simple as possible for you. For the structure you
propose, I would recommend organizing in Delaware. I organize LLC's and
corporations regularly and have done that in a number of states. I find
Delaware the state of choice for a variety of reasons, which I am happy
to explain. Among other things, they are reasonable in price and very
efficient. There is no tax to the LLC in Delaware other than an annual
fee so long as the company is not physically doing business there. It
is one of the few states where that is possible. Also the registered
agent I use charges only $50 annually.
The LLC can obtain an EIN and open an account. You could get a business
visa to come if you need to do so.
I would be happy to speak with you without cost. Interestingly I am
currently doing the same thing for another client where some members are
Indians and another is a U.S. citizen. However, in other instances the
members are foreign nationals including Indians and Kuwaitis.
/Kenneth A. Sprang
Cicero, Mehta & Sprang, LLP
1000 Potomac Street
Washington, DC 20007
Direct Dial: (202) 677-4703 or (202) 683-4090
Fax: (202) 677-4719
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Delaware has anonymous LLC ownership (I was told at a recent conference) and it may be a good reason.
Other reasons are to choose states with no state income tax.
To me, your big headaches will be your india operation. as a U.S. person (the LLC) it will have access to foreign bank accounts and services provided.
Here is a short list of problems:
1. Need for LLC to file form 3520 for money etc from india.
2. Meeting all 6038D regs whether they are on the form or not
3. FBar where the LLC has a foreign bank account
4. Withholding which prevents money from flowing back overseas unless filed.
5. Single member LLC is disregarded and so for tax (gasp!) you are treated as being the taxpayer. That means YOUR indian assets come into play as to 1-3 and withholding as to 4.
I can't say right now what a single member LLC would get in terms of treatment/respect as a focal entity for 1,2,3.
6. You may want something other than an LLC, such as a regular corp if you want privacy. You still have withholding, but because corp is a focal entity, ITS reach to India may not have as high a level of reporting as would your LLC taxed as a sole proprietorship.
There are other concerns, these are the main ones on my mind right now.
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Curt Harrington Patent & Tax Law Attorney Certified Tax Specialist by the California Board of Legal Specialization PATENTAX.COM This communication is general information and not legal advice, and does not create an attorney-client relationship. This communication should not be relied upon as any type of legal advice. Please note that no attorney-client relationship exists between the sender and the recipient of this message in the absence of either (1) a signed fee contract and (2) remission of an agreed-upon retainer. Absent such an agreement and retainer, I am not engaged by you as an attorney, nor is any other member of my law firm.
Both attorneys offer excellent advice. Mr Sprang even offers a free consult. What should be obvious from their comments is that you should not be doing this on your own and that you need corporate and tax counsel to assist you. I have read 100s of comments that Mr. Sprang has posted here at Avvo and you would be well served to at least speak to him about your sitatuation and to see if there is a fit between the two of you working together.
Hope this helps.
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