US Legal Compliance for Foreign Investors
FBAR, FATCA, Form 5472, BOI reporting, and ongoing LLC obligations
FBAR
Foreign accounts >$10K
FATCA
Form 8938 filing
Form 5472
Foreign-owned LLCs
BOI
Beneficial ownership
Tax Treaties
Reduced withholding
State Filings
Annual reports
Why Compliance Matters
Foreign investors face multiple overlapping reporting requirements at federal and state levels.
Federal Requirements
- FBAR for foreign accounts
- FATCA Form 8938
- Form 5472 for foreign LLCs
- BOI beneficial ownership
- Tax treaty forms (W-8BEN)
State Requirements
- Annual reports
- Franchise taxes
- Foreign qualification
- Registered agent
- Business licenses
FBAR: Foreign Bank Account Reporting
If you are a US person with foreign financial accounts exceeding $10,000 aggregate at any point during the year, you must file FinCEN Form 114.
Requirements
- Threshold: $10,000 aggregate at any time
- All foreign bank, securities accounts
- Filed electronically via FinCEN BSA
- Signature authority counts
Deadlines
- April 15 initial deadline
- Auto-extended to October 15
- No extension request needed
- Separate from tax return
FATCA: Foreign Account Tax Compliance
US citizens and residents must report foreign financial assets on Form 8938 if they exceed threshold amounts. Separate from FBAR.
Requirements
- Higher thresholds than FBAR ($50K+)
- Attached to federal tax return
- Bank accounts, securities, interests
- Foreign institutions auto-report to IRS
Thresholds
- US residents: $50K year-end, $75K any time
- Foreign residents: $200K year-end
- Married filing jointly: doubled
Form 5472: Foreign-Owned LLC Reporting
Every US LLC or corporation with 25%+ foreign ownership must file Form 5472 annually reporting transactions with foreign related parties.
Required For
- Foreign-owned single-member LLCs
- 25%+ foreign ownership
- Disregarded entities for tax
- Filed with pro-forma Form 1120
Reports
- Capital contributions
- Loans from/to foreign owner
- Distributions
- Related party transactions
Learn More: Form 5472 Complete Guide
See our detailed Form 5472 guide for step-by-step filing instructions, examples, and common mistakes to avoid.
BOI: Beneficial Ownership Information
The Corporate Transparency Act requires most US entities to report beneficial owners to FinCEN.
Report Includes
- 25%+ owners or substantial control
- Name, DOB, address
- ID number and document image
- Company applicant info
Deadlines
- New entities: 90 days from formation
- Existing entities: Check current rules
- Updates: 30 days after changes
- Corrections: 30 days after discovery
Learn More: FinCEN BOI Complete Guide
See our detailed FinCEN BOI guide for filing instructions, exemptions, and deadline information.
Tax Treaty Benefits
The US has tax treaties with many countries that can reduce withholding on dividends, interest, and royalties.
Forms Required
- W-8BEN for individuals
- W-8BEN-E for entities
- Must be on file before payment
- Valid for 3 years
Benefits
- Dividends: 15% instead of 30%
- Interest: Often 0%
- Royalties: Reduced rates
- Capital gains exemptions
Delaware Requirements
Annual Filings
- Annual franchise tax (March 1)
- Annual report
- $200 late fee + 1.5%/month
- Voided after 3 years non-payment
LLC Costs
- $300 annual franchise tax
- Registered agent required
- No state income tax (no nexus)
Wyoming Requirements
Annual Filings
- Annual report ($60/year)
- Anniversary month filing
- No state income tax
- Administrative dissolution risk
Benefits
- Lower annual costs
- Strong privacy laws
- No franchise tax
California Requirements
Annual Filings
- $800 minimum franchise tax
- Statement of Information
- Required if doing business in CA
- Foreign qualification needed
California Nexus
- Physical presence triggers
- Employees in CA
- CA-source income
- Significant CA sales
Annual Compliance Calendar
BOI Updates
Report ownership changes within 30 days
Delaware Franchise Tax
Annual report and franchise tax due
Corporate Returns
Form 1120 (C-corps), Form 1065 (partnerships)
FBAR, Form 5472, Individual Returns
Multiple deadlines converge
Non-Resident Returns
Auto 2-month extension for those abroad
Extended Deadlines
FBAR final; extended individual returns
Penalties for Non-Compliance
| Filing | Penalty |
|---|---|
| FBAR | $10K+ non-willful; $100K+ or 50% willful |
| FATCA (8938) | $10K + $10K/month after 90 days (max $50K) |
| Form 5472 | $25,000 per form per year |
| BOI Report | $500/day civil; $10K + 2 years criminal |
| State Reports | $50-$500 late; administrative dissolution |
| Delaware Tax | $200 late + 1.5%/month interest |