Form 1120 and 5472 for Foreign-Owned US LLCs (Step-by-Step Guide)

Filing IRS forms for your foreign-owned US LLC can feel overwhelming, but it doesn’t have to be. In this guide, we’ll walk you through how to properly fill out and submit Form 1120 and Form 5472 to stay compliant and avoid costly penalties.

Note: This article is for educational purposes. Consult a tax professional for personalized advice.

Who Needs to File Form 1120 and 5472?

If you’re a non-US person (citizen or resident) with a single-member US LLC, the IRS classifies your business as a foreign-owned disregarded entity (USDE). This means you must file:

• Form 1120: U.S. Corporation Income Tax Return (as a pro forma)
• Form 5472: Information Return for Foreign-Owned U.S. Entities

Example: Alex, a Nigerian freelancer, owns Alex Web Solutions LLC (registered in New Mexico). He operates remotely with no US office, employees, or physical presence. His clients pay via Stripe/PayPal, and he transfers earnings to his local Nigerian bank account. He must file both forms.

Key Filing Requirements

1. Write “Foreign-Owned USDE” at the top of Form 1120.
2. No e-filing allowed: Submit via fax or mail only.
3. Deadline: April 15 annually ($25,000 penalty for late filing).

• Extension possible via Form 7004.

1. Country codes matter: Use the IRS’s country codes. (e.g., Nigeria = “NI”; Niger = “NG”).

Step-by-Step: Filling Out Form 1120

1. Download the form: Search “IRS Form 1120 PDF” and “IRS Form 5472 PDF”.
2. Basic info:

• Business name (ex: Alex Web Solutions LLC).
• Foreign address (Best to use your US LLC address).
• EIN (Employer Identification Number).
• Date of incorporation (e.g., January 1, 2024).

1. Check “Initial Return” if it’s your first filing.
2. Sign as “Owner” (for single-member LLCs).

Tip: Form 1120 acts as a cover page — focus on accuracy, not completeness. You only need to file the top Part of the document. (See sample below)

Step-by-Step: Filling Out Form 5472

Part I: Business Details

• Repeat the business name, EIN, and tax year (e.g., January 1–December 31, 2024).
• Principal business activity: E.g., “Web Design” + activity code (find via IRS website or if you used a service like Bizee, it should be on your dashboard).

Part II: Foreign Owner Information

• Owner’s name/non-US address (e.g., Lagos, Nigeria).
• Reference ID: Create a unique number (e.g., “AlexWeb789”) and reuse it yearly.
• Taxpayer ID: Leave blank or add local tax ID (if applicable).

Part V & VI: Reportable Transactions

• Capital Contributions: Money spent on the business (e.g., 50statefiling+50statefiling+119 registered agent fee).
• Capital Distributions: Earnings transferred to your personal account (track via PayPal/Stripe/1099-K).

Example:

In 2024, Alex opened his US LLC and spent:

• $50 – for state filling fees
• $119 – in registered agent fees

He started receiving money from September to December and had income of 

• $8416.83 – Income

Alex’s 2024 breakdown will be as follows

• Capital Contribution: $169
• Capital Distribution: $8416.83
• total: $8,585.83 (from September–December earnings).

Checking Part V and Part VI will require us to attach a supporting document. You can download the complete 1120 & 5472 sample PDF, which also contains the supporting document.

How to Submit to the IRS

1. Combine forms: Merge Form 1120 (first) and Form 5472 into one PDF.
2. Fax for free: Use Fax.Plus (10 free pages):

• Upload your PDF.
• Enter the IRS fax number (e.g., +1 [IRS number]).
• Send and save the confirmation.

Note: Mailing is also an option (verify the IRS address yearly).

Common Mistakes to Avoid

•  Never claim US tax status: as a foreign owner, never present yourself as a US taxpayer unless you have effectively connected income (ECI), or your business is set up such that you have to pay US taxes.
• Wrong country codes: E.g., Nigeria = “NI” (not “NG”).
• Missing deadlines: April 15 is non-negotiable!

Final Thoughts

Filing Form 1120 and 5472 is simpler once you understand the requirements. Remember:

1. Track all business income/expenses.
2. Double-check country codes and owner details.
3. Fax or mail on time.

Need help? Drop questions in the comment section of our youtube video on this topic — we’re happy to clarify!