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Home / Blog Details
Scott Letourneau | | 0 Comments

U.S. Bank Compliance with LLC Formations: Essential Updates for 2025

Navigating the complexity of U.S. tax and legal compliance can often seem like a formidable challenge, particularly when it involves a single-member LLC disregarded to expand your U.S. e-commerce business to the U.S. You will now realize that a U.S. single-member LLC disregarded is NOT your best option when doing business in the U.S., not only from a banking point of view but also from changing the legal entity on your existing Amazon seller account.

A Major 2025 Update: A wave of transformation has recently swept over the requirements for financial technology companies interacting with U.S. banks. A pivotal aspect of this transformation is the stipulation for applicants to be recognized as a “U.S. person” to avail of their services. Traditional banks, such as Wells Fargo, Bank of America, Chase, and Citibank, want your U.S. company to have a U.S. office with a lease agreement or utility bill (not a business phone in most cases). The banks want to work with people from the U.S. who are doing the work. As you can imagine, this directly conflicts with your U.S. taxation goals as a non-resident. Experienced consulting is recommended to navigate this constantly moving target. Even traveling to the U.S. to open a personal bank account with the major banks is much more different in 2025 than before. Banks want to work with resident aliens who live in the U.S. with an apartment or residential address and utility bill in their personal name to match.

One of these regulations is the Foreign Account Tax Compliance Act (FATCA), which requires U.S. banks to report certain information about their foreign account holders to the IRS. To comply with FATCA, many banks must collect and report information about their account holders, including their tax residency status.

Another regulation that banks must comply with is the Bank Secrecy Act (BSA), which requires U.S. banks to identify and report suspicious activity. To comply with the BSA, banks must collect and verify the identity of all its account holders.

By requiring non-resident customers to be U.S. taxpayers, banks can ensure they can comply with FATCA and the BSA.

This poses a critical question: What does this change mean for entities like yours?

U.S. LLC Banking Changes Defining the ‘U.S. Person’ from an Entity Perspective:

  • Corporations and partnerships are orchestrated under the umbrella of U.S. state law.
  • Trusts that resonate with the “U.S. court” and “U.S. control” criteria, irrespective of their legal domicile.
  • Estates that resonate with a nuanced “facts and circumstances” examination involve considerations like the executor’s residence and the predominant location of assets.

For non-residents owning a single-member disregarded LLC, it’s essential to realize that such an entity typically does not align with the qualifications of a U.S. taxpayer.

Entities that Walk the U.S. Person Pathway for Non-Residents:

  • A U.S. LLC navigated through the tax landscape as a partnership (of course, this involves a partnership, which may be an existing entity from your home country, assuming not a single-member LLC that is disregarded and owned by the same owner).
  • A U.S. LLC taxed as a  corporation (this selection creates another issue if you have a need for a U.S. ITIN, but we have solutions).

The journey becomes particularly tumultuous when entities are called upon to affirm their U.S. person status while engaging with U.S. technology giants like Mercury. This is similar to completing a W-9, and under part 2, it says, under penalty of perjury, that you certify several items, including that you are a U.S. person.

Cautionary Winds: You do not want to perjury yourself on an IRS form or anything related close to that with U.S. banking. The fines and penalties can be severe. Other online banks that do not yet have these requirements may soon follow this trend, so make sure you are prepared for the best options for your U.S. e-commerce business, banking, and the overall tax results supporting your business growth.

Navigating Toward Solutions:

At NCP, we are here to guide you as you grow your business in the U.S. We will help you with many things like choosing the best banking options for now and the future, meeting Amazon’s insurance rules, setting up your U.S. business correctly, and understanding what taxes you will need to pay. We will also help you update your Amazon seller account to avoid extra checks like showing more utility bills. We make it easier for you to expand your business in the U.S.

If you need additional support in converting your existing single-member LLC disregarded to a corporation or partnership and retaking the Amazon tax interview, or perhaps you want to expand with the best options for your situation, we are here to help. Book a call with our team to clarify our best options and support.

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Corporate Transparency Act Impact on U.S. taxation
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