US Business Tax Filing for Each Company Type

Two layers: federal and state

Every US company deals with two separate tax layers. The federal layer is the IRS return, and it is the same no matter which state you formed in — a Wyoming LLC, a Delaware LLC, and a New Mexico LLC all follow identical federal rules. The state layer is separate: state income, franchise, or gross-receipts taxes depend on the state and on where the business has nexus (a taxable connection such as operations, employees, or enough in-state sales).

That distinction matters for remote founders. Forming in a no-income-tax state does not, by itself, eliminate all state tax if you actually operate somewhere else — and a pure holding LLC in Wyoming with no in-state operations usually has no state income-tax return at all. Get the federal layer right first; then assess the state layer based on where you truly do business.

• Federal filing is identical in every formation state.
• State income/franchise tax depends on the state and on nexus (where you operate).
• Forming in a no-income-tax state doesn't erase state tax where you actually operate.

How each entity is taxed (federal)

An LLC is a pass-through by default: a single-member LLC is a 'disregarded entity' (the US owner reports it on Schedule C of Form 1040), and a multi-member LLC is a partnership that files Form 1065 and issues a Schedule K-1 to each member. No entity-level federal income tax — profit flows to the owners.

A C-Corporation is a separate taxpayer. It files Form 1120 and pays a flat 21% federal corporate income tax on its profit, and shareholders are taxed again when profits are paid out as dividends — the 'double taxation' that defines a C-corp. It's the structure venture investors expect.

An S-Corp is not an entity — it's a tax election (Form 2553) placed on an LLC or corporation. It files Form 1120-S, passes income through to shareholders, and lets active owners split pay between a reasonable salary and distributions. But its shareholders must be US citizens or residents, which puts it out of reach for most non-US founders.

• LLC: pass-through — Schedule C (single-member) or Form 1065 + K-1 (multi-member).
• C-Corp: files Form 1120, flat 21% corporate tax, plus tax again on dividends.
• S-Corp: pass-through election (Form 1120-S); US-resident shareholders only.

Foreign-owned single-member LLC: the Form 5472 filing

This is the rule that catches almost every non-US founder off guard. A US LLC that is wholly owned by a non-US person and treated as a disregarded entity is still treated as a corporation for one narrow purpose: it must file a pro-forma Form 1120 with Form 5472 attached for any year it has a 'reportable transaction' with its owner. The capital you contribute at formation counts as a reportable transaction, so in practice virtually every active foreign-owned single-member LLC has to file.

The Form 5472 filing is an information return — it usually reports no US tax — but the penalty for missing it is $25,000, with more accruing if it stays unfiled after IRS notice. It is due April 15 (extendable to October 15 with Form 7004) and goes to a special IRS unit by fax or mail, not the normal 1120 address. Separately, if the LLC earns income effectively connected to a US trade or business (ECI), the non-resident owner files Form 1040-NR; a pure pass-through with no US ECI usually owes no US income tax.

• Foreign-owned single-member LLC files pro-forma Form 1120 + Form 5472 each year.
• The formation capital contribution is itself a reportable transaction — so almost everyone files.
• Penalty for non-filing is $25,000; due April 15 (Oct 15 with extension).
• No US ECI usually means no US income tax — but the 5472 information return is still required.

Federal forms and deadlines at a glance

Deadlines below assume a calendar-year filer and shift to the next business day when the 15th is a weekend or holiday. Extensions (Form 7004 for entities, Form 4868 for individuals) push the filing date, not the payment date — tax owed is still due by the original deadline.

• Multi-member LLC / partnership — Form 1065 + K-1: March 15 (Sept 15 with extension).
• S-Corp — Form 1120-S + K-1: March 15 (Sept 15 with extension).
• C-Corp — Form 1120: April 15 (Oct 15 with extension).
• Foreign-owned single-member LLC — Form 5472 + pro-forma 1120: April 15 (Oct 15 with extension).
• Single-member LLC (US owner) — Schedule C with Form 1040: April 15 (Oct 15 with extension).

State income, franchise, and gross-receipts taxes

Nine states levy no personal income tax — Alaska, Florida, Nevada, South Dakota, Tennessee, Texas, Washington, Wyoming, and New Hampshire (fully no-income-tax as of 2025). But 'no income tax' does not always mean 'no state filing.' Some states charge franchise or gross-receipts taxes regardless of income: Texas has a franchise ('margin') tax with a public information report even when no tax is due, Delaware charges a flat $300 annual LLC franchise tax, and California imposes an $800 minimum franchise tax on any LLC or corporation doing business there, profit or not.

You generally file a state income/business return wherever the company has nexus — which may be different from your formation state. A remote, non-US founder with a Wyoming or New Mexico holding LLC and no US operations typically has no state income-tax return; a founder who forms in Delaware but runs the business from California will still owe California's $800 and file there. We help you map this to where you actually operate.

• Nine no-income-tax states: AK, FL, NV, SD, TN, TX, WA, WY, NH (2025).
• Franchise/gross-receipts taxes can apply even with no income tax (TX margin, DE $300, CA $800).
• You file a state return where you have nexus, which may differ from the formation state.

Payroll, contractors, and estimated taxes

If your company has US employees — or you run S-corp owner payroll — you file employment-tax returns: Form 941 each quarter, Form 940 (FUTA) annually, and W-2/W-3 to employees and the SSA by January 31, plus state payroll filings. If you pay US independent contractors, you issue Form 1099-NEC (due January 31); the reporting threshold is historically $600 and rises to $2,000 for payments made after December 31, 2025.

Where tax is owed, it's paid as you go. Corporations make quarterly estimated payments if they expect to owe $500 or more for the year; individual owners, partners, and S-corp shareholders use Form 1040-ES. Missing estimated payments can trigger underpayment penalties even if you pay in full at filing.

• US employees / S-corp salary: Forms 941 (quarterly), 940 (annual), W-2/W-3 by Jan 31.
• US contractors: Form 1099-NEC by Jan 31 ($600 threshold, rising to $2,000 after 2025).
• Estimated taxes: corporations at $500+ expected; owners via Form 1040-ES.