Start a US LLC From India: Steps, FEMA and Payments

You can start a US LLC from India entirely online — no US visit, no SSN, no minimum capital. The US side takes days. The part that deserves real attention is the Indian side, because sending money out of India to fund and own a foreign company runs through FEMA, and the classification of that investment decides what you have to report.

Bottom line

• Formation plus EIN is achievable remotely in one to three weeks. Year one typically costs roughly $150–$600 depending on state and provider.
• Indian residents can remit up to USD 250,000 per financial year under the RBI’s Liberalised Remittance Scheme. Whether your US LLC stake is treated as Overseas Direct Investment or Overseas Portfolio Investment under the 2022 Overseas Investment rules — and what reporting follows — is a question for a chartered accountant.
• India taxes residents on worldwide income, and the Place of Effective Management concept can make a foreign company an Indian tax resident. Neither of those disappears because the entity is American.

Why Indian founders form US LLCs

The motivations are practical, not exotic.

Access to US payment infrastructure. Stripe, Paddle, US-domestic card rates, US marketplaces and US B2B procurement all run more smoothly through a US entity with an EIN and a US business bank account.

Client trust in B2B sales. American and European buyers sign faster with a US counterparty. For agencies and SaaS companies selling into the US mid-market, the entity is a sales asset.

Clean USD invoicing. Billing in dollars from a dollar-holding entity, with USD costs paid from the same balance, removes a layer of conversion friction that eats margin on every transaction.

Simplicity relative to a US C-Corp. An LLC has no board, no stock, no 83(b) elections. For a founder who is not raising US venture capital, it is the lighter instrument.

What a US LLC does not do: change your Indian residency, exempt you from Indian tax, or take the transaction outside FEMA.

The formation steps, in order

1. Choose the state. Wyoming and New Mexico are the common picks for non-residents — low fees, no entity-level state income tax, strong privacy. New Mexico requires no annual report for LLCs at all; Wyoming charges an annual report license tax with a $60 minimum for LLCs holding $300,000 or less of in-state assets, due in your anniversary month. Delaware carries a flat $300 LLC franchise tax due June 1 and mainly makes sense if US investors are in the plan. Detail in wyoming-vs-new-mexico-llc.

2. Appoint a registered agent. Mandatory in every state. It is a physical in-state address that accepts legal service on the LLC’s behalf.

3. File Articles of Organization. Online in most states. Fees vary by state, so read the current fee schedule rather than an article.

4. Get the EIN — no SSN required. File Form SS-4 and put “foreign” on line 7b if you have neither an SSN nor an ITIN. International applicants can apply by phone on 267-941-1099 or fax to 304-707-9471; the IRS says fax generally returns an EIN in about four business days, while mail takes roughly four weeks. Walkthrough in how to get an EIN without an SSN.

5. Sign the operating agreement. Even as a sole member. Banks ask for it, and it is the document that proves who owns what.

6. Open the US business account. Remote-friendly platforms accept a foreign passport plus EIN, formation documents and the operating agreement. Approval is never guaranteed — see us-business-bank-account-for-non-residents.

7. Diarise compliance. State annual report or franchise tax, registered agent renewal, and Form 5472 with a pro forma Form 1120 for a foreign-owned single-member LLC. That last one carries a $25,000 failure-to-file penalty and applies in zero-revenue years.

doola handles steps 2 through 6 as one flow, including a US address, and is built specifically for founders outside the US. Firstbase is the cheaper, narrower option if you want the entity and EIN and will run your own compliance. The trade-offs are laid out in doola-vs-firstbase.

The Indian-side questions to confirm with a CA

Everything in this section is a question to take to a chartered accountant with your real numbers. None of it is advice, and the rules here have moved more than once.

LRS and the annual limit. The Liberalised Remittance Scheme, under FEMA 1999, allows a resident individual to remit up to USD 250,000 per financial year (April to March) for permissible current and capital account transactions. Remittances beyond that require RBI approval. Ask how your formation fees, capital contribution and ongoing vendor payments are each categorised, and whether they draw on the same limit.

ODI versus OPI. Investment by residents in overseas entities is governed by the Foreign Exchange Management (Overseas Investment) Rules, Regulations and Directions of 2022. The split between Overseas Direct Investment and Overseas Portfolio Investment matters, because ODI brings conditions and reporting that OPI does not. Acquiring equity in an unlisted foreign entity is generally the ODI side of that line. Ask your CA specifically: does a single-member US LLC membership interest count as ODI for me, what conditions attach, and what forms and annual filings follow.

Sector and structure restrictions. The 2022 framework restricts certain activities for resident individuals — financial services activity is the usual example — and imposes conditions around control and layered structures. If your US LLC will do anything near lending, payments, insurance or investment management, raise it explicitly.

The 180-day repatriation point. Under the RBI framework, funds remitted abroad and not used for the permitted purpose are to be brought back to India within 180 days. Do not park capital in the LLC “for later” without checking this.

TCS on outward remittances. Tax collected at source applies to LRS remittances above a threshold. Both the rate and the threshold have been revised more than once, so get the current figures from your bank or CA rather than from any article, including this one.

Indian tax residence of the LLC itself. Under section 6(3) of the Income-tax Act, a foreign company is resident in India if its Place of Effective Management is in India. CBDT Circular 8 of 2017 states that the POEM guiding principles do not apply to companies with turnover or gross receipts of ₹50 crore or less in a financial year — but that limits the application of the guidance, not the statute itself. If you make every key management and commercial decision from India, ask your CA what that means for you.

Reporting and the return. Indian residents are taxed on worldwide income and have foreign asset and foreign entity disclosure requirements in the income tax return at certain thresholds. Ask which schedules apply.

What to bring to the meeting: state of formation, ownership percentage, the amounts and dates of every remittance, where you physically work, whether the LLC has US staff or premises, expected revenue, and whether profits will be distributed or retained.

Banking and payments

Banking is the bottleneck, not formation. The realistic route from India is a fintech business account opened remotely with your passport, EIN, stamped formation documents, a signed operating agreement and a US business address. Registered agent addresses are commonly rejected as the business address, which is one reason bundled formation packages include a real suite address.

More applications fail on inconsistency than on nationality. If the address on your Articles differs from the one on your EIN letter, fix that before you apply.

On payments: a US LLC with an EIN and a US bank account can generally operate Stripe as a US business, which changes both the onboarding path and the domestic card economics compared with an Indian entity. Stripe also sells its own incorporation product if you would rather buy the entity and the payment stack together; it is a legitimate alternative to the formation services above, just a narrower one.

Keep the money trail clean in both directions. Document every inbound remittance and every founder distribution. A hybrid structure — Indian resident, US entity, dollar revenue — is defended with records, and reconstructing them two years later is miserable.

Who should do this, and who should not

Go ahead if you sell to US or global customers, you need US payment rails or US buyer trust, and you are willing to pay for both a CA consultation in India and a US tax preparer. That professional cost is part of the real price.

Reconsider if your customers are all Indian, your work is all performed in India, and the only appeal is a lower headline tax rate. That combination puts you squarely in the territory the Indian rules are written to examine, and a domestic private limited company may be simpler and cheaper overall.

FAQ

Do I need to travel to the United States?

No. Formation, EIN and remote-friendly business banking can all be done from India. Traditional branch banks generally do want an in-person visit, which is exactly why founders use the fintech route.

Can I fund the LLC from my normal savings account?

The remittance goes out under LRS through an authorised dealer bank, and the bank will ask for the purpose code and documentation. Whether your specific contribution is treated as ODI or something else is the question to settle with your CA before you initiate the transfer.

Will a US LLC lower my Indian taxes?

Do not assume it will. You remain taxed on worldwide income as an Indian resident, and the POEM provision can make the foreign company itself an Indian tax resident. Any tax conclusion needs your CA’s review of your facts.

Which state should an Indian founder choose?

Wyoming for low ongoing cost, New Mexico to avoid annual reports, Delaware only if US investors are realistically in your future. The state matters far less than the FEMA and reporting analysis.

This is general information, not legal, tax or FEMA advice. Confirm your position with a chartered accountant in India and a CPA or attorney in the US before acting.

If you want the whole US side handled in one pass — entity, EIN, US address, bookkeeping — doola is the option built for non-US founders. If you want the lean version and will manage compliance yourself, Firstbase does the job for less. Either way, start with us-llc-for-non-residents and book the CA conversation before the first remittance leaves India.