How to obtain a Medical License in USA to practice?

Reducing requirements for USA federal tax

• I have formed LLC in Delaware (and opened bank account) in order to obtain merchant account for myself, and to sell software online through my website. I am not resident of USA, and have never visited USA. My Delaware LLC is sort of 'reseller' for my own products - it will receive invoice from my domestic company for each license of the software it sells, reduced by %1 (to pay any expenses delaware LLC may have) of the price end-customer pays. 50% of customers will be USA customers. So, question is this: if I sell product for $100, and my delaware LLC has to pay to my domestic company $99, is $1 what is taxed? Or, does federal tax needs to be paid on $100. I asked one attorney to investigate this for me, and he said that my company (single-owner LLC) in USA does not need to pay taxes, but I personally do (since I'm taxes as a sole proprietor) to $100. This cannot be right, can it?

• Answer:

  Hi barumbarum, It is recommended that an LLC have more than one member because if not, the IRS will tax it as a Sole Proprietor. With only one owner, the LLC will not be considered a separate entity from the owner. If all of your services are performed outside the U.S., as a nonresident alien, your income would not be subject to U.S. income tax. But because you've formed an LLC as a Sole Proprietor in the U.S., your tax-free benefit has been lost. So the attorney was correct but I don't think he quite nailed the reason why. An accountant might have been a more appropriate person to consult. To enjoy the US tax free benefit, it is advised that the LLC have two or more members. "Features of a Delaware Limited Liability Company: * A Delaware LLC may be formed by one or more organizer or member. It is not recommended that one member only is used. An LLC may be treated like a Sole Proprietorship by the IRS when owned by one member. If the member is a non-resident alien, and the LLC derives its income outside of the US, the tax free benefit will be lost when treated like a Sole Proprietorship by the Internal Revenue Service (IRS)" http://www.us-llc-for-non-residents-of-the-usa-incorporate-llc-in-us.offshore-companies.co.uk/delaware/llc_in_delaware/ >>>> About U.S Source Income "Non US persons are only taxed on US source income or income connected with the conduct of a US trade or business. If the LLC earns only income which falls outside this definition and the members of the LLC are non US persons with no US presence then no tax would be payable either by the LLC or by its members." http://www.ujoffshore.com/enghtml/services/incorp_jurisd_delawllc.asp U.S. or Non-U.S. Source Income: "Nonresident aliens, for tax purposes, unlike U.S. citizens and residents, are only subject to tax on income that is considered U.S. Source Income by the IRS. Foreign Source Income received by nonresident aliens is not subject to U.S. taxation. * U.S. Source Income - income is generally considered U.S. Source if the location of the activity for which the payment is being made is in the U.S. * Foreign Source Income - income is generally considered foreign source if the location of the activity for which the payment is being made is outside the U.S." http://vpf-web.harvard.edu/ofs/tax_services/emp_pay_sou.shtml >>>> About an LLC Sole Proprietor IRS FAQ: I recently formed a limited liability company (LLC). The LLC has no employees. Do I need a separate Federal Tax ID number for the LLC? "No, you will not need a separate Federal Tax ID number for the LLC if you are the sole owner of the LLC and the LLC has no, employees. If you are not the sole owner of the LLC or if the LLC has employees, you will need a separate Federal Tax ID number for the LLC. If your business has only one owner, it will automatically be considered to be a sole proprietorship (referred to as an entity to be disregarded as separate from its owner) unless an election is made to be treated as a corporation." http://www.irs.gov/faqs/faq12-1.html 34. What are the advantages of operating as a Delaware LLC by nonresident non-U.S. citizens? 34.1 "If properly structured, a Delaware LLC will be treated as a partnership for Federal income tax purposes. And, you may be able to legally avoid all U.S. Federal income taxes for non-U.S. business source income." http://www.delbusinc.com/faqllcs.htm "The default tax treatment (by the IRS) of an LLC with only one member is as a sole proprietorship unless an election is made to treat it as a corporation The IRS, by default, treats all LLCs with more than one member as a partnership, unless that LLC makes an election to be treated as a corporation for tax purposes." http://www.delawareintercorp.com/forms.htm I hope I've been able to make that clear. If you have any questions, please post a clarification request *before* closing/rating my answer and I'll be happy to reply. Thank you, hummer Search Strategy: I searched the IRS website and also Google using the terms: LLC nonresident alien LLC foreign LLC offshore LLC Sole Proprietorship LLC Delaware