How to File IRS Form 5472 and 1120 Pro Forma for a Foreign-Owned US LLC

For non-U.S. digital nomads, setting up a U.S. LLC is a popular way to access Stripe, PayPal, and pay 0% tax legally (or you can compare it with Estonia e-Residency). However, having a "disregarded entity" does not exempt you from the IRS.

Every year, foreign-owned single-member LLCs must file two specific documents with the IRS: Form 5472 and a "Pro Forma" Form 1120.

TL;DR: Even if your LLC had $0 in revenue, had no U.S. source income, or was completely inactive, you must file Form 5472 and Form 1120. The penalty for failing to file on time or submitting an incomplete form is a strict $25,000. These forms must be submitted to the IRS via Fax or Mail by April 15 of the following tax year.

This guide provides a simplified, box-by-box walkthrough on how to prepare and submit these forms yourself.

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Do You Need to File? (The IRS Criteria)

You must file if your business meets the following three conditions:

1. Your LLC is a domestic entity (formed in any U.S. state like Wyoming, Delaware, or New Mexico).
2. The LLC is 100% owned by a single foreign individual or foreign corporation (Non-Resident Alien).
3. The LLC is a "disregarded entity" (the default tax classification for single-member LLCs).

If you meet these criteria, you are classified as a Foreign-Owned U.S. Disregarded Entity and must file.

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Phase 1: Preparing the "Pro Forma" Form 1120

A "Pro Forma" Form 1120 is a standard corporate tax return used solely as a cover sheet. You do not calculate corporate income tax; you leave most of the page blank.

Box-by-Box Guide for Form 1120:

1. Top of Page 1: Write clearly in print: "Foreign-Owned U.S. DE" across the top margin.
2. Name & Address: Enter your LLC’s legal name, and its registered address (your registered agent's address).
3. Section B (EIN): Enter your Employer Identification Number (EIN).
4. Section C (Total Assets): Enter 0.00.
5. Section E (Checkboxes): Check the box for "Initial return" if this is your first year filing, or "Final return" if you dissolved the LLC.
6. Section E (Foreign-Owned check): Check the box indicating the corporation is foreign-owned (this is usually a checkbox labeled "Foreign-owned disregarded entity" or Section E).
7. Signature Section: Sign and date the bottom of Page 1. Write your title as "Managing Member" or "Owner".
8. Pages 2–6: Leave pages 2 through 6 completely blank. Do not enter any income, deductions, or tax calculations.

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Phase 2: Preparing Form 5472

Form 5472 is where you report information about your identity and any transactions between you (the foreign owner) and the LLC.

Box-by-Box Guide for Form 5472:

Part I – Reporting Corporation (Your U.S. LLC)

• Box 1a (Name): The legal name of your LLC.
• Box 1b (EIN): Your LLC's EIN.
• Box 1c (Address): Your LLC's mailing or registered agent address.
• Box 1h (Total Assets): Enter 0.00 (matching Form 1120).
• Box 1j (NAICS Code): The 6-digit Business Activity Code representing your industry (e.g., 541511 for custom computer programming, 541613 for marketing consulting).
• Box 1l (State of Incorporation): The state where you formed the LLC (e.g., Wyoming).

Part II – 25% Foreign Shareholder (You, the Owner)

• Box 1a (Name): Your full personal name.
• Box 1b (U.S. TIN): If you have an ITIN or SSN, write it here. If not, write "Foreign".
• Box 1c (Address): Your personal home address in your home country.
• Box 1e (Country of Citizenship): Your country of citizenship.
• Box 1g (Country of Residence): Your primary country of tax residency.

Part III – Related Party

Since you are both the related party and the 25% shareholder, you will enter your personal details here again:

• Box 1a (Name): Your full personal name.
• Box 1b (U.S. TIN): Your ITIN (or "Foreign").
• Box 1c (Address): Your personal foreign home address.
• Check the box for "Foreign person".

Part IV – Monetary Transactions (Crucial Step)

This is where you report the total amount of money transferred between you and your LLC during the tax year. These are classified as "Reportable Transactions":

• Capital Contributions: The money you transferred from your personal bank account to the LLC bank account to fund the business or pay for setup expenses.
• Distributions: The money you withdrew from the LLC bank account to pay yourself.
• How to report: Under Section 1.6038A-2(b)(7), you must report these. The easiest way is to enter the sum of these transactions in Part IV, Line 11 (other transactions) or attach a short, plain-text statement to the forms detailing the exact capital contributions and distributions.

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Phase 3: How to Submit to the IRS

The IRS does not allow foreign-owned disregarded entities to e-file these forms online. You have only two submission methods:

Method 1: Fax (Recommended)

This is the fastest and most secure method. You can use an online fax service (like Fax.plus or HelloFax) to send the documents directly to the IRS.

• IRS Fax Number (Disregarded Entities): [phone] (U.S.) or [phone] (from outside the U.S.).
• Tip: Fax both forms together (Form 1120 on top, followed by Form 5472, and any attached statements). Keep the fax transmission receipt as proof of timely submission.

Method 2: Mail

If you prefer physical mail, send the documents via registered mail or international courier (DHL/FedEx) to keep a tracking number.

• IRS Mailing Address: > Internal Revenue Service > 1973 Rulon White Blvd. > M/S 6112 > Ogden, UT 84201

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Authoritative Reference Sources

• IRS Form 1120 Portal: IRS Form 1120 Page
• IRS Form 5472 Portal: IRS Form 5472 Page
• IRS Disregarded Entities Information: Single-Member LLC Regulations

**Disclaimer:* The information in this guide is for educational purposes only. Tax compliance rules are strict and carries major financial penalties. Consult a certified public accountant (CPA) or a qualified U.S. tax attorney regarding your LLC's specific filing obligations.*