· 3 min read
Closing a US LLC as a non-US owner: what changes
Non-US owners of a US LLC face extra federal reporting when they close the company, including a final Form 5472 and pro forma 1120. Here is what is different and how to handle it from abroad.
A US LLC owned by someone living outside the United States is dissolved the same way as any other LLC, with one major addition: the federal information reporting that applies to foreign-owned companies must be completed for the final year, and the IRS penalty for missing it is severe. Everything else, from the state filing to closing the EIN, can be done remotely.
The filing that non-US owners most often miss
A single-member LLC owned by a non-US person is treated as a foreign-owned disregarded entity. Every year, including the year it closes, it must file Form 5472 attached to a pro forma Form 1120. The form reports transactions between the LLC and its owner, such as capital contributions and distributions. Closing the company and distributing the remaining cash to the owner is itself a reportable transaction.
The penalty for not filing is $25,000 per form, per year. Many owners only discover the obligation when they try to close the company, and the catch-up filings become the largest part of the project.
A multi-member LLC with non-US owners files a partnership return instead, and may have withholding obligations on income allocated to foreign partners.
What stays the same
| Step | Same for non-US owners? | Notes |
|---|---|---|
| Owner resolution | Yes | Signed electronically from anywhere |
| State catch-up filings | Yes | Online in most states |
| State dissolution filing | Yes | Some states accept only mail; allow extra time |
| Final federal return | Different | Form 5472 + 1120, or Form 1065 for partnerships |
| Closing the EIN | Yes | Letter to the IRS, can be mailed from abroad |
| Bank account closure | Often harder | US banks may require a call or a visit; plan this early |
Practical steps from abroad
- Confirm whether Form 5472 was filed for every year the LLC existed. If not, those years must be filed before or with the final return.
- Bring state annual reports and franchise tax up to date. Do this before filing the final federal return, because the dissolution date on the federal side should match the state record.
- File the final Form 5472 and pro forma 1120, marking it as final. Report the closing distribution to the owner.
- File the state dissolution. Check whether your state requires a notarized signature; a few still do, and foreign notarization or an apostille takes time.
- Close the EIN account with the IRS by letter, and close the bank account once the final filings are done and fees are paid.
Frequently asked questions
Do I need a US address to dissolve the LLC? No. The registered agent address serves for state purposes until the dissolution is filed, and the IRS accepts a foreign mailing address.
Can I close the company if I never used it? Yes, but an unused LLC still has filing obligations for every year it existed. Form 5472 is required even when there was no business activity, because the formation itself and any capital contribution are reportable.
How long does it take? If filings are current, four to eight weeks depending on the state. If Form 5472 has never been filed, add the time needed to prepare the catch-up years, usually two to four weeks of work before the dissolution can be filed.