How to Incorporate a Company in the U.S. as a Non-Citizen (Part 1)

The United States is flush with economic opportunities, especially for entrepreneurs. However, opening a business doesn’t happen overnight. It’s an involved process, which can be daunting for non-citizens who are eager to make their business a reality.

Between strategy building, sussing out the landscape, and in-depth planning, there are a lot of baby steps that need to be taken in order to set any business owner up for success – let alone someone who's not a resident of the United States.

The current landscape is not tilted in the favor of entrepreneurs who are non-citizens. In fact, in some ways, it can feel as if it’s stacked heavily against them. But the odds are not insurmountable.

First Steps on the Road to Success 

Am I Eligible to Incorporate a Company in the U.S.?

Yes, you are! You just need to follow the proper steps that any entrepreneur, American or otherwise, needs to perform before they’re legally allowed to open their business.

Here are the 8 basic steps you need to follow to be eligible to open your business in the U.S., regardless of your citizenship status:

1. Choose your type of corporation (LLC or C Corp)
2. Register your business’ name
3. Get your Employer Identification Number (EIN)
4. Determine if you need a state tax number, based on your chosen state
5. Obtain all necessary business permits and licenses for your industry
6. Purchase insurance for your business
7. Open a business bank account in the U.S.

The last step can either come at the beginning or at the end. In many cases, it’s best to incorporate this step throughout your startup process:

•  Get consultations from professionals.

Getting professional guidance will ensure that your paperwork is always filed properly, you’re meeting all the federal and state regulations required by your industry, your finances are being tracked and monitored properly, and you’re checking all the boxes to protect yourself and your business from unnecessary obstacles.

What are the Different Types of Corporations in the United States?

There are three types of corporations that exist within the United States:

• Limited Liability Company (LLC)
• C Corporation (C Corp)
• S Corporation (S Corp)

For non-residents, the easiest route would be to register as an LLC or a C Corp.

The difference between them is determined by whether you’re the sole owner of the business, or if you’ve got other co-founders or partners with whom you’re starting the business.

How Long Does It Take to Start a Business in the U.S.?

The act of registering a business may only take a few days, but there’s a lot more that goes into incorporating a company in the U.S. than simply deciding what products or services you’re going to offer, and then developing a brand for your business.

Not only do you need to decide what type of corporation you’re going to register, but you’ll need to consider how each different type of corporation would affect how you and your business are taxed. Making plans to segregate your personal taxes from those of your business requires careful planning.

In addition, each state has unique regulations pertaining to how businesses are taxed. It may not be complicated opening a retail business in states like Texas, but if you’re going to be running an online eCommerce store, the process becomes substantially more complex.

You’ll be required to pay taxes based on the regulations of the state in which you’ve incorporated, but you’ll also be responsible for paying appropriate taxes in each state in which you’re selling. 

• How are you going to run your business? 
• Are you going to be producing everything yourself? 
• Or are you going to be doing a lot of outsourcing and partnering with third-party vendors? 
• Who are these vendors going to be, and can partnering with them be profitable for your business? 

All of these factors take time to evaluate, arrange, and implement.

There are a lot of hard realities to face as a new corporation. There’s more to consider in regards to this than just “how quickly can I open my business?”. You need to do a lot of high-level thinking and strategizing so that you’re prepared to face these realities head-on.

This means that there is no clear-cut answer for how long it takes to start a business in the U.S. You can register a company, and maybe even open the doors on a business in a relatively short period of time.

However, years of planning and months of strategic execution often go into the most successful startups.