A US Corporation is an entity that has its own legal status and must file its own tax return annually. There are two types of US Corporations:

- S Corporations (all owners / shareholders with more than 25% ownership must be US citizens)

- C Corporations (owners / shareholders can be any nationality)

Corporations must appoint three officers: President, Treasurer and Secretary. The officers can issue shares to denote a portion of ownership.

A LLC is a Limited Liability Company. As per the title, the entity operates like a company but limits the level of liability for the owners (members). From a tax perspective an LLC can elect to be taxed as one of the following:

- a disregarded entity

-a partnership

- a corporation

An LLC can be established in any of the 50 US states and ‘domesticate’ into any other state as needed. Gingerbread Tax generally recommends either Wyoming or Delaware for LLCs and Delaware for C-Corporation establishment.

This varies between US States. Each Secretary of State has their own establishment fees and reporting requirements. Costs for establishing an LLC can range between $500-$1,500. Gingerbread set up LLCs in several states starting from $500. Apply for an LLC

LLCs require an in-state registered agent to be appointed to receive any entity related correspondence. Registered Agents provide this service for fee per entity. Registered agents are a legally appointed entity who contact you in the event of state based action related to your LLC.

Most LLCs can be applied for online. The time taken to establish an LLC is usually between 48-72 hours. When establishing an LLC you will receive Articles or Organization and an Operating Agreement.

As in Australia, there are ongoing costs for maintaining an LLC. This involves submitting an annual report, updating contact details for the officers or organizers, and paying an annual fee. This usually needs to be done via US credit card or check. The annual costs vary by state and the volume of in-state business conducted. Gingerbread Tax can help you Renew Your LLC