Many people outside the US form a US LLC to sell online, take payments or work with US clients. When the business ends, the LLC does not end with it. It stays on the state's records, and its account with the IRS stays open, until someone formally closes both. The good news: you do not need to travel to the US, and you do not need a US bank account to do it. This guide explains what is different when the owner lives abroad, and the steps in order.
What is the same for every LLC
The basic process does not depend on where you live. A voluntary dissolution has three parts:
- The members approve the dissolution, as the operating agreement requires. For a single-member LLC, that is a simple written decision by you.
- The LLC files the state's dissolution document with the Secretary of State. The name differs by state: Delaware calls it a "Certificate of Cancellation", Wyoming and Florida use "Articles of Dissolution", and Colorado uses a "Statement of Dissolution".
- The LLC winds up: it pays its debts, collects what it is owed and distributes what is left to the members.
For the full process, see how to dissolve an LLC. The rest of this guide covers what changes when you are outside the US.
What is different when you live abroad
Your registered agent is your US address
Most foreign owners have never had a US office. The registered agent is the only US address the state knows. The state sends its notices there: annual report reminders, penalty letters and, at the end, confirmation of the dissolution. Before you start, log in to your registered agent's portal and check for any mail you missed. An old notice about a missed annual report tells you there may be an amount to pay before the state accepts a dissolution.
Do not cancel the registered agent first. Cancel it only after the state confirms the dissolution. See when to cancel your registered agent.
You do not need a US bank presence to file
The state filing is a document and a fee. It does not require a US bank account, a US phone number or a visit to an office. The IRS letter that closes the EIN account is also a paper letter. You can sign both from wherever you live.
Paying state fees from abroad
Some state websites do not accept foreign cards, or ask for a US billing address. This is one of the most common reasons foreign owners get stuck. When we handle the dissolution, we pay the state fee for you. You pay us once, by card, and the state fee is passed on at cost as a separate line at checkout.
Form 5472 is still due for the final year
This is the most important difference. A single-member LLC owned by a foreign person must file Form 5472, attached to a pro forma Form 1120, for every year it exists. That includes the year it closes. Reportable transactions include money you put in, loans, and money the LLC paid out to you, including the remaining funds you take out when you close it. The penalty for not filing is $25,000 per form, per year. Read more in Form 5472 in the year you close.
If your LLC has two or more members, it usually files Form 1065 instead, and withholding forms can apply to foreign partners. See dissolving a multi-member LLC.
The EIN account must be closed separately
The state does not tell the IRS that your LLC is dissolved. The IRS never cancels an EIN, but it can close the business account. To do that, the LLC sends the IRS a letter with its complete legal name, the EIN, the business address and the reason for closing, signed by an owner. If you have the EIN assignment notice (CP 575), a copy helps. The IRS will not close the account until all required returns are filed, including the final Form 5472. Its confirmation comes by mail, which for a foreign owner usually means the registered agent or the address on file, and it can take several weeks. More in how to close your EIN business account.
Step by step, from abroad
- Find your documents. The LLC's exact legal name, the state it was formed in, the EIN, and the CP 575 notice if you have it.
- Check the mail at your registered agent. Look for notices about annual reports, fees or franchise taxes.
- Check standing with the state. Most states want the LLC in good standing before they accept a dissolution. Delaware, for example, requires its $300 annual LLC tax for every year, including the year of cancellation. Wyoming requires the LLC to be active and in good standing.
- Finish the business. Pay the last bills, collect what customers still owe, and move the remaining money to yourself. Keep a record of each payment, because it may be reportable on the final Form 5472.
- Close payment accounts. Close Stripe, PayPal and marketplace accounts once the last payouts have arrived. Close the bank account after the last payments.
- Approve and file the dissolution. Sign the written decision and file the state's dissolution document.
- Have the final return filed. Your accountant files the final Form 5472 with the pro forma Form 1120, marked as final.
- Close the EIN account. Send the closing letter to the IRS and wait for its confirmation.
- Cancel the registered agent after the state confirms the dissolution.
- Keep the records. Many advisors suggest keeping the LLC's records for at least several years.
If the LLC also had state tax accounts, such as a sales tax permit, close those too. Most foreign-owned LLCs selling online do not have state payroll, but if yours did, close that account as well.
What we do, and what we do not do
With the dissolution package ($349 plus state fee), we check the LLC's standing with the state, file the state's dissolution document and send you the state's confirmation. With the dissolution and EIN closure package ($449 plus state fee), we also prepare the IRS letter that closes the EIN account for your one signature, and send it. We work with a network of independent, licensed CPAs and tax advisors.
If the state wants an overdue amount first, for example a missed annual report, we get back to you about it before anything is paid. We do not prepare or file Form 5472 or any other tax return. Your accountant does that.
We cover Arizona, Colorado, Delaware, Florida, Georgia, Indiana, Montana, North Carolina, Nevada, Oregon, Virginia and Wyoming. Popular states for foreign owners include Wyoming, Delaware and Florida. For more on closing from another country, see close your US LLC from abroad.