Lots of people dream about being their own boss and starting their own business. The United States is famous for the "American Dream", the idea that if you have a good idea and work hard, you can be successful. That's why many aspiring entrepreneurs see the US as the perfect place to kickstart their ventures. Fun fact: almost half of the Fortune 500 companies were started by immigrants or their kids.聽
The good news? You don't have to be a US citizen to start a business there, but you do need to know the ropes. Whether you're moving to the US or already living there and want to start your own business, it's crucial to plan ahead. You will need to understand all the procedures that go into starting a business, including visa considerations, registering and maintaining your business, tax obligations, responsibilities and liabilities, and more.
US Government policies affecting foreign businesses and entrepreneurs
America First Investment
In 2025, the U.S. introduced the 鈥溾�� which impacts foreign investment, especially from China and other countries deemed, by the current administration, to be 鈥渇oreign adversaries.鈥� This policy expands the jurisdiction of the (CFIUS), introduces a quicker approval process for investors from allied countries, and imposes restrictions on investments in sectors like tech, infrastructure, healthcare, agriculture, energy and more.
International Entrepreneur Rule (IER)
The now features revised financial thresholds, expanded evidence requirements, and more flexible application options, making it more accessible for some foreign startup founders to launch and grow businesses in the U.S. This is explored in more detail in the 鈥榲isa considerations' section.
Most common company types in the US
You will first need to decide on what type of company you intend to open. This is a very important decision as it will determine your daily operations, taxation, how much of your investments are at risk, and more. There are three main options you will have, which are:
- LLC or limited liability company;
- C-Corporation;
- S-Corporation;
- Sole proprietorship.
In general, foreign entrepreneurs choose LLCs or C Corporations, which do not require U.S. citizenship or residency.
Sole proprietorships or partnerships are less common due to liability and tax complexities, while holding companies are sometimes used to manage multiple subsidiaries or structure investments.
Limited Liability Company (LLC)
An LLC is a smart choice for starting a business in the US, especially if you're not a citizen. The key benefit is that an LLC shields your personal assets (like your savings, home, and car) from business debts and legal troubles. So, if things don't go according to plan, your personal assets stay safe. Another plus is the simple and cost-effective tax setup. With an LLC, your business earnings flow through your personal income taxes. No need for extra paperwork or separate forms, saving you money on accounting. It's a win-win for protecting assets and keeping taxes hassle-free.
C-Corporation
Considering a business structure, but not a US resident? A C-Corporation might be the best choice for your situation. This setup is great if you're sharing business responsibilities with other investors. Investors love corporations because they can own shares without diving into day-to-day business tasks. However, the issue with this structure is that corporations face double taxation. When the business makes a profit, it gets taxed. Then, when shareholders receive dividends from their shares, they get taxed again. Despite this, a C-Corporation makes sense for non-US residents who want shares that they can easily transfer to others. If you're a US resident, you might want to explore an S-Corporation instead 鈥� it's usually a better fit.
S-Corporation
If you are a US resident, then an S-Corporation might be your best bet. Unlike its C-Corporation counterpart, this structure sidesteps double taxation and gets taxed only as an S-Corporation. This makes it a more tax-friendly option for US residents diving into the business world. What is the major distinction from an LLC? It's all about the tax structure. If you've chosen the LLC route but not the S-Corporation tax status, you'll be taxed like a sole proprietor or, if you have multiple owners, like a partnership. All your business earnings or losses flow through your personal tax return. With an S-Corporation, you have the flexibility to pay yourself a salary, keeping money in the business and avoiding it passing through your personal income tax filing. Depending on your business's profit size, this choice can save you more on taxes. Remember, though, only US residents can be shareholders in an S-Corporation.
Sole Proprietorship
Sole proprietorship is probably the most straightforward way to kick off a business in the US. If you're in business but haven't formally registered any entity, you're automatically a sole proprietor, but here's the downside: personal liability. In a sole proprietorship, your business assets and debts are tied to your personal ones. So, if your business faces financial trouble, you could be personally responsible for all the debts and obligations. It's a quick and easy start, but it comes with a more direct personal risk.
Sectors open or restricted to foreign entrepreneurs
Most industries in the US, such as retail, services, e-commerce, manufacturing, and technology, are open to foreign ownership. However, new restrictions apply to investments from certain countries (including China, Russia, Iran, North Korea, Cuba, and Venezuela) in sectors like critical technology, infrastructure, healthcare, agriculture, energy, raw materials, and other areas considered sensitive to national security. reviews are mandatory in these sectors, and some investments may be prohibited. If you are from a country considered to be a foreign adversary, you are likely to be subject to high levels of scrutiny.
Registering your business in the US
Once you have decided on what type of company you want to form 鈥� and if you are allowed to own a business in this sector 鈥� you will need to go through the company registration process. You will need to complete all the necessary steps to register your business before you can start operations in the US.
If you are not resident in the US when you start your business, you may wish to acquire a registered agent, also known as a resident agent, which is an individual or entity officially acknowledged by the state where your business is incorporated. This agent must reside within the state where you register the business and is designated by your company to accept legal documents on its behalf.
If you are not yet able to be on the ground in the US, having a registered agent can be very helpful. They can handle important legal paperwork and ensure you obtain and renew business licenses and stay compliant with deadlines.
Each state has its own requirements for registered agents, but generally, they must possess a physical address within the state, be available during regular business hours, and be at least 18 years old. Alternatively, you have the option to enlist the services of a company, like , that specializes in providing registered agent services.
Depending on what type of company you are forming, your legal status in the US, and whether you are using an agent, the exact procedures for registering your business may differ.
Key procedures and documents required
Choose your business structure: LLC, C Corporation, or Partnership. Each structure impacts your taxes, liability, and operational control.
Select your state: Each US state has different regulations, fees, and tax laws. Some states also offer tax incentives or simplified registration processes for foreign entrepreneurs. Consider infrastructure, access to skilled labor, and supply chains when choosing a location.
Register your business name: It must be unique within the state and meet naming guidelines. Trademarking your business name is optional but recommended for brand protection.
File formation documents: Submit Articles of Organization (for an LLC) or Articles of Incorporation (for a C Corporation) with the appropriate state agency.
Get an EIN (Employer Identification Number): This is required for paying taxes, opening a bank account, and hiring employees. Foreign nationals can apply for an EIN by submitting
Get a U.S. mailing address: If you don't have a physical location yet, use a virtual office or registered agent service that provides mail forwarding.
Open a US bank account: To open a business bank account, you'll typically need an EIN, formation documents, a passport, and a U.S. mailing address (some banks accept virtual addresses). If you're overseas, consider remote banking services or partner banks in your home country.
Obtain business insurance: Coverage can protect your business from lawsuits, natural disasters, or other unexpected losses.
Apply for an ITIN (Individual Tax Identification Number): If you are not eligible for a Social Security Number, you'll need an ITIN for tax purposes. Apply through the IRS.
Understand your tax obligations: Register with federal and state tax authorities. It's strongly recommended to consult a US accountant, particularly if you are a non-resident.
Secure business licenses and protect intellectual property: Licensing requirements vary by industry and location. For IP protection, consider registering trademarks or filing patents early.
Submit annual reports and pay franchise taxes: Most states require annual filings and fee payments to keep your business in good standing.
Maintain compliance: Failing to stay up-to-date on paperwork and renewals can result in penalties or dissolution of your company.
Seek professional advice: Legal, tax, and immigration professionals can help you avoid costly mistakes and stay compliant with US law.
Important:
Starting a small business in the US is like starting one in any other country. It's crucial to do market research, have a carefully thought-out business plan, and secure the capital needed to put your plan into action. is an official government agency that helps to counsel and assist small business owners.
Visa considerations for entrepreneurs and investors in the US
Those who hold a Green Card and are legal residents of the United States do not need to worry about this section. Every other foreign national, however, will need to carefully consider their visa options. The US offers several pathways for entrepreneurs, investors, and company founders to legally launch or expand businesses within the country.
The most common business-related visa and immigration options currently include the E-2, EB-5, L-1, O-1A, and E-1 visas 鈥� along with the recently updated International Entrepreneur Rule (IER).
International Entrepreneur Rule (IER)
This rule allows up to three founders per company to apply for temporary residency if they each own at least 10% of the business and play a central role in operations.
- Investment thresholds: As of October 2024, applicants must show either $311,071 from qualified US investors or $124,429 in US government grants. Extensions require $622,142 in follow-on investment.
- Evidence requirements: Applicants must provide documentation of ownership, job creation potential, financials, and market strategy. The IER now accommodates early-stage startups that haven't reached profitability but can demonstrate high growth potential.
- Duration: Initial stay is 30 months (2.5 years), renewable if growth and job creation benchmarks are met.
- Priority and access: Startups with strong funding or economic impact can request discretionary fast-tracking. USCIS now allows digital submissions for applicants outside the U.S.
E-2 Treaty Investor Visa
This visa allows nationals from treaty countries to either start or purchase a business in the US.
- Investment requirements: There's no fixed minimum, but most applicants invest between $50,000 and $200,000. The funds must be irrevocably committed and 鈥渁t risk.鈥�
- Ownership and control: The investor must own at least 50% of the company or have operational control.
- Application process: Includes Form DS-160, proof of investment, a detailed business plan, and an interview at a U.S. embassy or consulate.
- Duration and renewal: Granted for up to two years, renewable indefinitely as long as the business remains viable.
- Spouse work rights: Spouses of E-2 visa holders can apply for work authorization.
EB-5 Immigrant Investor Visa
Often called the 鈥�million-dollar Green Card,鈥� the EB-5 is a direct route to permanent residency.
- Investment thresholds (2025): $1,050,000 in a general area, or $800,000 in a Targeted Employment Area (TEA).
- Job creation: Applicants must create at least ten full-time jobs for US workers.
- Residency: Successful applicants receive a Green Card for themselves and their immediate family.
You must also prove that your investment funds come from a legal source and that you will play an active role in the business.
L-1 Intracompany Transfer Visa
Designed for entrepreneurs expanding a foreign business into the US, this visa allows the transfer of executives, managers, or key employees.
- Eligibility: The applicant must have worked for the foreign entity for at least one year within the past three years.
- US presence: The US entity must be a parent, subsidiary, affiliate, or branch, and must be actively doing business. New ventures must secure premises and submit a viable business plan.
- Duration: L-1A (executives/managers) is valid up to 7 years; L-1B (specialized knowledge employees) for up to 5.
- Green Card Path: L-1A holders may transition to permanent residency under the EB-1C category.
O-1A Visa (Individuals with Extraordinary Ability)
This visa is intended for founders who can demonstrate national or international acclaim in their field.
- Requirements: Evidence may include major awards, media coverage, publications, or industry impact.
- Duration: Granted for up to 3 years initially, with extensions possible.
- Green Card Path: Eligible to apply for permanent residency under the EB-1A category.
E-1 Treaty Trader Visa
This visa is ideal for those engaged in substantial trade between their home country and the U.S.
- Activities covered: Includes goods, services, banking, insurance, tourism, and consulting.
- Eligibility: Restricted to nationals of countries with relevant trade treaties with the US.
Other potential options
- H-1B Visa: For entrepreneurs with advanced degrees working in a 鈥渟pecialty occupation.鈥� Subject to an annual cap and lottery.
- EB-2 National Interest Waiver (NIW): Entrepreneurs who can show that their business activity benefits the U.S. national interest may be eligible for a Green Card without employer sponsorship.
Important:
Depending on your specific background, funding, nationality, and business plan, visa eligibility can vary widely. Some visas (like the E-2) require you to be from a treaty country. Others (like the EB-5) have high investment thresholds but offer permanent residency.
It's always a good idea to conduct preliminary research, but once you've decided to establish a business in the US, consult a qualified immigration attorney who can help evaluate your best options and ensure you meet current requirements.
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