A foreign-owned single-member LLC needs an EIN for the company and, in practice, an ITIN for its owner. The IRS treats the LLC as a disregarded entity that must file Form 5472 with a pro forma Form 1120 each year, and the instructions ask for the 25 percent foreign owner's US identifying number, an SSN or an ITIN; missing the filing carries a $25,000 penalty. Beyond the IRS, every US bank and card issuer identifies the person behind the company, and for a non-US owner that means a passport and an ITIN. The EIN alone leaves the owner invisible.
Does a foreign-owned LLC need an ITIN?
The company does not; the owner does. An LLC gets an Employer Identification Number from the IRS, free, and a company owned by a non-US person can get one without the owner holding an SSN or ITIN. That is where most formation services stop, and it is why so many founders arrive at a bank with a company nobody can identify. The IRS's single-member LLC page explains that a single-member LLC is generally a disregarded entity, which means the IRS looks through the company to its owner. Looking through the company requires a number for the owner.
Form 5472 and the $25,000 rule
A foreign-owned US disregarded entity is treated as a reporting corporation and must file Form 5472, Information Return of a 25% Foreign-Owned US Corporation, attached to a pro forma Form 1120, for each year it has reportable transactions with its foreign owner, which in practice means most years, since capital contributions and distributions count. The instructions state the penalty in one sentence: a penalty of $25,000 will be assessed on any reporting corporation that fails to file Form 5472 when due and in the manner prescribed.
The same instructions ask, for each 25 percent foreign shareholder, for the shareholder's US identifying number, if any: individuals enter a Social Security Number or an ITIN issued by the IRS. If any is the IRS's phrase, and a foreign owner without a US number can enter a foreign taxpayer number in the space provided for it. But the owner who wants the company's return, their own return and the bank's file to line up under one identifier gets the ITIN. Whether and how the 5472 applies to your company is a filing question for your tax adviser; we mention it because founders tell us nobody did.
What does the ITIN unlock for an LLC owner?
| Need | EIN alone | EIN plus owner's ITIN |
|---|---|---|
| Form the company and get the EIN | Yes | Yes |
| Open a fintech business account online | Often yes, with a passport | Yes |
| Open a business account at a national bank, in person | The bank must identify the owner; passport number is one route, taxpayer number another | Yes: the bank has both the company's and the owner's numbers |
| Owner's US return, if one is required | No | Yes: the W-7 is filed with it |
| Form 5472's owner identifying number field | Foreign taxpayer number, if any | Yes: SSN or ITIN, as the instructions ask |
| US credit cards in the owner's name, then the business's | No file exists to build on | Yes: issuers file history under the ITIN |
Why banks look through the company to you
The federal customer identification rule, 31 CFR 1020.220, requires a bank to identify the customer and, for a company, the people behind it. For a non-US person the rule accepts a taxpayer identification number, a passport number, or another government document number. A passport alone can satisfy the rule; a passport plus a US taxpayer number is what the desk is used to seeing, and the difference shows in how the account is treated afterwards.
Richard ran a multi-owner Wyoming LLC on a fintech account whose credit, in his words, was leverage on what you hold in the account rather than a real credit system. Jack described his Wyoming LLC before the number as invisible to the financial institutions. Both had EINs. Neither had a person the banks could see until the ITIN.
Which state, and does it change the ITIN?
It does not change the ITIN, which belongs to you wherever the company sits. It changes the bank conversation. Founders who form in a state with anonymous ownership records and then walk into a branch discover that the banker cannot verify who owns what, which is why our clients form or re-domicile in Florida before the trip. Jack moved from a private Wyoming LLC to a public Florida one for that reason. The order guide explains the state question; the Miami guide explains the trip.
How the owner of an LLC gets an ITIN
Form W-7 with proof of identity and foreign status, a valid passport doing both. The W-7 is filed with the federal return that needs the number or under one of the five exceptions in the instructions; which route fits an LLC owner depends on whether income or withholding exists in the owner's name, and the pairing is checked before filing. The IRS allows 7 weeks, 9 to 11 in peak season or from abroad. Through a Certifying Acceptance Agent the passport is verified in a live video session and certified; nothing is mailed. Our fee is $399, refundable until we file.
The order that works for a founder
- Start the ITIN. The IRS's weeks are the longest lead time in the whole setup.
- Form the company and get the EIN while the IRS works; put the documents in the shape a banker accepts.
- Book the trip once the CP565 letter is in hand. Open the accounts in person.
- Build the cards on the accounts and the history the banks now see, one at a time.
- File what your adviser says the company and you must file, including Form 5472 where it applies, with the numbers that match.