IRS Form 5472: Foreign-Owned LLC Reporting
The $25,000 penalty you must avoid if you own a US LLC
Per Year Penalty
For each unfiled form
Filing Deadline
Extension to Oct 15
Rule Change
All foreign LLCs must file
Even If No Income
Required if dormant
Why Form 5472 Matters
If you are a non-US person and you own a single-member LLC in the United States, you have an annual filing obligation: IRS Form 5472 with an accompanying pro forma Form 1120.
Filing Required Even If
- LLC has no US-source income
- LLC conducts no business activity
- LLC is completely dormant
- LLC has zero reportable transactions
The IRS wants to know about the existence and ownership structure of every foreign-owned US entity.
Filing Requirements
You must file Form 5472 if you meet BOTH criteria:
1. Reporting Corporation
- Any US corporation 25%+ foreign-owned
- Foreign corporation in US trade/business
- Single-member LLC owned by foreign person
2. Reportable Transactions
- Capital contributions (money you put in)
- Distributions (money you take out)
- Sales, purchases, rents, royalties
- Services, interest, commissions
What to File
A foreign-owned single-member LLC must file:
Form 5472
- Part I: Reporting corporation info
- Part II: 25% foreign shareholder info
- Part III: Related party info (if applicable)
- Part IV: Monetary transactions
- Part V: Disregarded entity transactions
- Part VI: Nonmonetary transactions
Pro Forma Form 1120
- Page 1: Name, address, EIN, dates
- Item E: Check if no assets/income
- Schedule K: Questions 2 and 3
- Write "NONE" on income lines
- Sign the form
Deadlines and Where to File
Filing Deadlines
- Calendar year LLCs: April 15
- With extension (Form 7004): October 15
- Fiscal year LLCs: 15th day of 4th month after year end
Mail completed forms to:
Department of the Treasury
Internal Revenue Service Center
Ogden, UT 84201-0012
EIN Requirement
To file Form 5472, your LLC must have an Employer Identification Number (EIN). This is true even if your LLC has no employees.
How Foreign Persons Get EIN
- File Form SS-4 by fax or mail
- Call IRS: +1-267-941-1099 (not toll-free)
- Use US-based third party (attorney, registered agent)
Required Information
- Responsible party designation
- SSN, ITIN, or foreign passport number
- Country of citizenship
- LLC formation documents
Common Filing Scenarios
Scenario 1: Dormant LLC with No Activity
You formed a Wyoming LLC in 2024. You deposited $5,000 into the LLC's bank account but conducted no other business. The LLC has no income and no expenses.
Filing required: The $5,000 deposit is a capital contribution - a reportable transaction. Report it in Part V.
Scenario 2: Real Estate Holding LLC
You own a Florida condo through a Delaware LLC. The LLC received $24,000 in rental income, paid $12,000 in property management fees, and distributed $6,000 to you.
Filing required: Report the $6,000 distribution in Part V. If you personally provided any services to the LLC, report those as well.
Scenario 3: E-Commerce Business LLC
You operate an online store through a US LLC. The LLC earned $200,000 in revenue and paid you a $50,000 management fee.
Filing required: Report the $50,000 management fee in Part IV. Separate Form 5472 may be needed for each related party.
Scenario 4: LLC Owned by Foreign Corporation
Your BVI company owns a US LLC that holds investment securities. The LLC has $500,000 in assets and received $15,000 in dividend income.
Filing required: Report capital contributions from and distributions to the BVI company. BVI company info goes in Part II.
Step-by-Step Filing Guide
Filing Delinquent Returns
If you have unfiled Form 5472 returns from prior years, you have several options:
Option 1: Quiet Disclosure
- Simply file delinquent returns
- Include cover letter explaining late filing
- Risk: IRS may assess full $25K penalty
Option 2: Reasonable Cause Statement
- File with detailed explanation
- Request penalty abatement
- Include supporting documentation
Option 3: Delinquent IIR Procedures
- IRS procedures for late international returns
- Requires reasonable cause
- Must not be under examination
- No prior IRS notice about the returns
| Violation | Penalty |
|---|---|
| Failure to file Form 5472 | $25,000 per form, per year |
| Filing incomplete or inaccurate Form 5472 | $25,000 per form |
| Failure to maintain records | $25,000 |
| Continued failure after IRS notice (per 30-day period) | Additional $25,000 |
| Criminal penalties for willful failure | Up to $25,000 fine and/or imprisonment |
Reasonable Cause Defense
The $25,000 penalty may be waived if you can demonstrate "reasonable cause" for the failure to file:
Requirements
- You exercised ordinary business care and prudence
- You were unable to file despite your efforts
- The failure was not due to willful neglect
Recordkeeping Requirements
The IRS requires you to maintain records sufficient to establish the accuracy of Form 5472. Records must be kept for at least 7 years.
Required Records
- Books and records of the US LLC
- Bank statements
- Contracts with related parties
- Capital contribution documentation
- Distribution records
- Transfer pricing documentation
Related Filing Requirements
- FinCEN BOI Report - All LLCs
- Form 1040-NR - If US income
- Form 8833 - Treaty positions
- Form 8288 - FIRPTA withholding
- State Annual Reports - Varies by state
Annual Compliance Checklist
Before Tax Year Ends
- Confirm LLC has valid EIN
- Maintain current registered agent
- Track all capital contributions
- Track all distributions
Prepare to File
- Document related-party transactions
- Complete Form 5472 (all parts)
- Complete pro forma Form 1120
- Sign Form 1120
Submit and Retain
- File by April 15 (or extended)
- Retain copies for 7+ years
- File FinCEN BOI report (separate)
- File state annual report