File Form 5472 and pro forma 1120 correctly. April 15 deadline, $25K penalties for non-compliance. Complete guide for foreign-owned LLC owners.
If you own a US LLC as a nonresident, Form 5472 and pro forma 1120 are mandatory federal filings—even if your business has zero income. These forms help the IRS monitor transactions between foreign owners and their US entities, and failure to file comes with serious consequences.
In this guide, we simplify Form 5472 requirements for nonresident business owners, explain what "pro forma 1120" actually means, and show you how we handle the entire filing process so you can focus on growing your business.
Foreign-owned single-member LLCs must file Form 5472 and pro forma 1120 annually by April 15, even with zero income. Penalties reach $25,000 per form per year for non-compliance. We handle all Form 5472 filing through our federal tax service, ensuring accurate and timely submission.
Understanding the critical numbers behind Form 5472 compliance helps you grasp the importance of proper filing:
The $25,000 penalty applies even to dormant LLCs—the IRS requires Form 5472 if you've made any capital contributions, paid formation costs, or conducted any transaction between yourself and your LLC.
Form 5472 is an information return that reports transactions between a foreign-owned US entity and related parties. The IRS uses this form to combat tax evasion and monitor cross-border financial flows.
You must file Form 5472 if your business meets any of these criteria:
Single-member LLC 100% owned by a nonresident alien or foreign entity
US corporation with at least one foreign shareholder owning 25%+ voting power or value
Foreign corporation engaged in US trade or business
Most nonresident business owners fall into the first category: Foreign-Owned US Disregarded Entities (FOUSDEs). If you're a nonresident who owns a single-member LLC, you have a FOUSDE and must file Form 5472 annually.
The IRS defines a foreign person as:
If you don't have a US green card or don't meet the substantial presence test, you're a foreign person for tax purposes.
The term "pro forma 1120" confuses many nonresident owners—it's not a separate form, but rather a simplified version of Form 1120 used exclusively as a cover page for Form 5472.
When filing as a FOUSDE, you only complete these sections of Form 1120:
Required Information:
What NOT to Complete:
Think of pro forma 1120 as a "wrapper" for Form 5472—it provides basic identification information and serves as the vehicle to submit the actual reporting form.
Important: "Pro forma" doesn't mean "draft." This is your actual required filing. The IRS treats an incomplete pro forma 1120 the same as a regular tax return—it's a valid submission when used for Form 5472 filing.
Form 5472 requires detailed reporting of transactions between your LLC and foreign related parties (mainly you, the owner). Understanding what counts as a transaction is critical—even dormant LLCs typically have reportable items.
These common business activities must be reported:
| Transaction Type | Examples |
|---|---|
| Sales & Purchases | Inventory, supplies, equipment |
| Services | Consulting fees, management services, technical support |
| Rents & Royalties | Office space rental, intellectual property licensing |
| Loans & Interest | Owner loans to LLC, interest payments |
| Commissions | Sales commissions, finder's fees |
| Insurance Premiums | Business insurance paid to foreign insurers |
This section catches most nonresident owners, even those with dormant businesses:
Even if your LLC earned zero dollars in revenue, the act of funding your LLC (capital contribution) and paying formation costs makes Form 5472 filing mandatory.
You must also report:
Understanding when and how to file Form 5472 ensures you avoid penalties and maintain compliance.
Calendar year filers (most LLCs)
If you file Form 7004 by April 15
4th month after tax year end
The extension only extends time to file—not time to pay any taxes owed. However, for FOUSDEs with no US effectively connected income, there's typically no tax liability.
Critical Filing Requirement: FOUSDEs cannot e-file. You must file by mail or fax:
Mailing Address: Internal Revenue Service 1973 Rulon White Blvd M/S 6112 Attn: PIN Unit Ogden, UT 84201
Fax Number: 855-887-7737
Important: Do not use the standard Form 1120 filing address. FOUSDEs have a dedicated processing address in Ogden, Utah. Using the wrong address can delay processing or result in the IRS claiming they never received your filing.
Before you can file Form 5472, you need:
EIN (Employer Identification Number): Apply via Form SS-4. Nonresidents without SSN/ITIN must file by fax or mail (2-4 weeks processing time).
ITIN (Individual Taxpayer Identification Number): Recommended if you have US effectively connected income, though not always required for Form 5472 filing.
FTIN (Foreign Taxpayer Identification Number): You must provide your home country tax ID on Form 5472 Part II.
We handle EIN and ITIN applications as part of our company formation and federal tax filing services, eliminating the complexity of navigating IRS application processes from abroad.
The IRS takes Form 5472 compliance seriously, with significant penalties designed to encourage accurate and timely filing.
How Penalties Work:
The IRS increased penalties from $10,000 to $25,000 in mid-2018, signaling a serious crackdown on foreign-owned shell companies.
The IRS considers Form 5472 substantially incomplete if:
Even small errors can trigger the full penalty—accuracy matters.
Learning from common errors helps you file correctly the first time and avoid costly penalties.
The biggest misconception among nonresident LLC owners is thinking Form 5472 only applies to businesses with income.
Reality: Even dormant LLCs with zero revenue must file if any reportable transaction occurred—including formation costs and initial capital contributions.
Solution: We review your LLC activity and determine filing requirements regardless of income level through our federal tax filing service.
Many nonresident owners forget that transferring money to their LLC bank account counts as a reportable transaction.
Examples of reportable contributions:
Solution: Track all transfers between your personal accounts and LLC accounts from day one. We help you identify and report all transactions accurately.
Sending Form 5472 to the standard Form 1120 processing center (not the dedicated Ogden, Utah address) causes delays and potential penalties.
Solution: Always use the dedicated FOUSDE address: 1973 Rulon White Blvd, M/S 6112 Attn: PIN Unit, Ogden, UT 84201.
FOUSDEs cannot e-file Form 5472—attempting to do so through tax software results in rejection.
Solution: File by mail with tracking or fax with confirmation. We handle proper filing methods to ensure the IRS receives your forms.
Failure to maintain adequate records carries the same penalty as failure to file—$25,000 per year.
Solution: Use our accounting service to maintain proper transaction records and generate necessary documentation for Form 5472 filing.
If you've missed Form 5472 deadlines or face penalties, you may qualify for relief under reasonable cause provisions.
The IRS accepts "reasonable cause" as a defense against Form 5472 penalties when you demonstrate:
Reasonable Cause Factors:
IRS Guidance: The IRS instructs examiners to "apply reasonable cause exception liberally" for corporations with:
Reliance on a qualified tax professional constitutes reasonable cause where special training is required—another reason to work with specialists in nonresident tax compliance.
If you have a clean compliance history, you may qualify for First-Time Abate (FTA):
Requirements:
FTA provides automatic relief for many first-time offenders without requiring detailed reasonable cause explanation.
If you haven't filed Form 5472 in prior years, the IRS offers delinquent filing procedures:
We handle delinquent filing procedures and penalty abatement requests through our federal tax service, giving you the best chance of penalty reduction or elimination.
Nonresident business owners often confuse Form 5472 with FinCEN Beneficial Ownership Information (BOI) reporting—they're separate requirements with different purposes.
| Aspect | Form 5472 | FinCEN BOI |
|---|---|---|
| Purpose | IRS tax compliance, transaction monitoring | Anti-money laundering, ownership disclosure |
| Agency | Internal Revenue Service (IRS) | Financial Crimes Enforcement Network (FinCEN) |
| Frequency | Annual | Initial + updates when ownership changes |
| Who Files | Foreign-owned US entities | Foreign entities registered in US (as of March 2025) |
| Deadline | April 15 (calendar year) | 30 days after ownership change |
As of March 26, 2025, FinCEN BOI reporting now exempts domestic reporting companies. The requirement only applies to foreign entities registered to do business in the US. However, filing Form 5472 does not satisfy BOI requirements—they remain separate obligations.
We monitor both IRS and FinCEN requirements and ensure you meet all applicable federal reporting obligations through our compliance services.
Managing Form 5472 compliance from another country involves multiple complexities—transaction tracking, form preparation, deadline monitoring, and proper filing methods. We make the entire process effortless.
We combine Form 5472 filing with comprehensive bookkeeping through our accounting service, ensuring accurate transaction records and seamless annual filing.
Explore our federal tax filing service designed specifically for nonresident LLC owners. We handle Form 5472, pro forma 1120, and all IRS compliance requirements—so you can focus on growing your business without worrying about $25,000 penalties.
Yes. Form 5472 filing is required even with zero income if any reportable transaction occurred between you and your LLC. This includes capital contributions (funding your LLC), formation costs, and any expenses you paid on behalf of the business. The IRS requires Form 5472 regardless of revenue or profit.
Pro forma Form 1120 is a simplified version of the standard corporate tax return used exclusively as a cover page for Form 5472. You only complete basic identification information (LLC name, EIN, signature) and write "Foreign-owned U.S. DE" at the top. You do not complete income, deduction, or tax calculation sections.
Form 5472 is due April 15 for calendar year filers (most LLCs). You can extend the deadline to October 15 by filing Form 7004 by April 15. Fiscal year filers must submit by the 15th day of the 4th month after their tax year ends.
Failure to file Form 5472 triggers a $25,000 penalty per form per year. If you remain non-compliant after IRS notification, you face an additional $25,000 for each 30-day period after 90 days. Additionally, the statute of limitations on your entire tax return remains open indefinitely until you file.
No. Foreign-owned US disregarded entities (FOUSDEs) cannot e-file Form 5472 or pro forma 1120. You must file by mail to the dedicated Ogden, Utah address (1973 Rulon White Blvd, M/S 6112 Attn: PIN Unit, Ogden, UT 84201) or by fax (855-887-7737).
You must report all transactions between your LLC and foreign related parties (mainly you, the owner). This includes capital contributions, capital distributions, formation costs, sales, purchases, services, rents, royalties, loans, interest, and any other monetary or non-monetary exchanges. Even paying $100 for LLC formation is a reportable transaction.
An ITIN is recommended but not always required for Form 5472 filing. You must provide an EIN (Employer Identification Number) for your LLC and a foreign taxpayer identification number (FTIN) from your home country. If you have US effectively connected income, you'll need an ITIN to file Form 1040-NR. We help you determine ITIN requirements based on your specific situation through our federal tax service.
Form 5472 is an IRS tax compliance form reporting transactions between your LLC and foreign owners, due annually. FinCEN BOI reporting discloses beneficial ownership information for anti-money laundering purposes, filed initially and when ownership changes. As of March 2025, BOI reporting only applies to foreign entities registered in the US. Filing Form 5472 does not satisfy BOI requirements—they're separate obligations.
Need help with Form 5472 and federal tax compliance? Explore our federal tax filing service designed specifically for nonresident LLC owners. We handle Form 5472, pro forma 1120, transaction reporting, and IRS compliance—ensuring accurate filing and penalty avoidance while you focus on business growth.
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