Form 5472 · step by stepForm 5472 instructions for a foreign-owned single-member LLC – step by step
A foreign-owned single-member LLC files two documents together: a pro forma Form 1120 with almost nothing on it, and Form 5472 with the LLC, its owner and every money movement between them. Everything is in English, in whole US dollars, and is sent to the IRS by fax or mail.
What you need before you start
- The LLC’s name, US address and EIN (the IRS employer identification number).
- The date the LLC was formed and its main business activity.
- Your own details as the owner: address, country of citizenship and of tax residence, and your tax ID in your country – or a Reference ID if you have none.
- Every movement of money or value between you and the LLC during the year: deposits, withdrawals, loans, formation costs and expenses either side paid for the other – with dates and amounts.
- The LLC’s total assets at the end of the year.
The pro forma Form 1120
1. Write “Foreign-owned U.S. DE” across the top
This tells the IRS the 1120 only carries Form 5472 – the LLC is not filing a corporate income tax return.
2. Fill in only the header
The LLC’s name and address, item B (EIN) and item E (initial return, final return, name or address change, when they apply). No income, deductions or tax.
3. Sign it as the owner
The owner signs with the title “Owner” and the date.
Form 5472, part by part
1. Part I – the LLC (reporting corporation)
Name, address, EIN, total assets at year end (line 1c), principal business activity and its code, the countries where the LLC does business, and line 1f – the total value of all reportable transactions of the year (lines 22 and 36 plus the Part V and Part VI amounts). Mark line 1j if this is the first year the LLC files Form 5472.
2. Part II – the 25% foreign shareholder
You, the foreign owner: name, address, country of citizenship, country of tax residence, the countries where you do business and your foreign tax ID. Without a tax ID, use a Reference ID – letters and digits only, up to 50 characters, the same one every year.
3. Part III – the related party
For a single-member LLC this is you again: the same details, marked as a foreign person and as the 25% foreign shareholder.
4. Part IV – money transactions
Loans to or from you, payments for services, rent, interest and other amounts between you and the LLC, each on its line; lines 22 and 36 are the totals received and paid.
5. Part V – the foreign-owned DE statement
Check the box and attach a statement listing contributions you made, distributions you took, formation costs you paid and expenses either side paid for the other. For most owners this is where almost everything goes.
6. Part VI – nonmonetary transactions
Only if something was given or used without full payment (for example equipment lent free of charge) – at fair market value, described in a statement.
7. Part VII – additional questions
Lines 37 to 42b; a typical foreign-owned LLC answers “No”. Line 43 is not completed by a foreign-owned disregarded entity.
Mistakes that cost the most
- Skipping the form in a year with no income – the formation fee or a single deposit already counts as a reportable transaction.
- Leaving out the pro forma 1120, or trying to e-file: this return goes only by fax (855-887-7737) or mail to the IRS in Ogden.
- Amounts in cents or in another currency – the forms use whole US dollars; keep the exchange rate you used.
- A different Reference ID every year – it must stay the same for the same owner.
- No proof of sending – keep the fax confirmation or the certified mail receipt.
LLC Desk fills it in for you
You answer in Spanish or English; LLC Desk fills Form 5472, the Part V statement and the pro forma 1120 field by field, you sign on your phone, and it is faxed and mailed to the IRS with proof.
Join the LLC Desk listGeneral information from the IRS instructions, not tax advice. The owner reviews, signs and is responsible for the forms. When in doubt, ask a tax professional.