"You want to pay 0% taxes? Then just form a US LLC!"

– you have probably read or heard this somewhere.
Sounds tempting. Almost too good to be true.

But is it really that simple?

In this article we will take you through the most important basics:

What a US LLC actually is, when it truly operates tax-free – and what you absolutely need to pay attention to if you want to go down this route.

1. What exactly is a US LLC?

The Limited Liability Company (LLC) is a US business form that combines many advantages: the protection of a corporation and the flexibility of a sole proprietorship.

Sounds technical? In short:

• You protect your private assets .
• You can act flexibly in terms of taxes – especially if you do not have a permanent establishment in the USA.
• And administration is comparatively simple and can be done digitally – even from abroad.

The LLC is therefore extremely attractive, especially for international entrepreneurs, digital nomads or online businesses.

2. When is a US LLC truly tax-free?

In principle, an LLC can remain income tax-free in the USA if certain conditions are met.

The three most important conditions:

✅ Your LLC has no US permanent establishment (i.e. no office, no staff, etc. in the States)
✅ You are not a US citizen and are not subject to tax in the US
✅ You are at best the sole owner* (Single-Member LLC)

* This definitely makes the process easier!
If you plan to set up your LLC together with a business partner, this is generally possible - there are just a few special considerations.
👉 Read more in the article: " Tax-free with Multi-Member LLC "

If this is the case, your LLC is considered a so-called Foreign-Owned Disregarded Entity – and is not subject to income tax in the USA .

Important: What happens with taxes in your country of residence (e.g., Germany) is a completely different story. We'll briefly address this below.

3. Advantages of a US LLC – at a glance

• Liability protection : Your private assets are left out
• Transparent taxation : profits flow directly to you
• Recognized worldwide : Especially in business & e-commerce
• No US residency required : You can control everything remotely
• Anonymity possible : Depending on the state, no disclosure of your data

Who is this worth it for?

We particularly recommend the US LLC:

• Digital nomads , freelancers & online coaches
  → Ideal for location-independent business models without US customers
• Perpetual Traveler , i.e. people without a permanent residence
  → Legally secure structure without tax implications
• E-commerce entrepreneurs , especially with US customers
  → For efficient payment processing, marketplace usage & branding
  
• Entrepreneurs from countries with territorial taxation (e.g. Dubai, Panama)
  → Foreign income usually remains tax-free in the country of residence
• Investors & Capital Raisers , e.g. for US real estate or business credit
  → Access to the US financial system, BLOCs, 0% credit cards & investments

If you find yourself in one of these scenarios, an LLC could open up new possibilities for you – both financially and strategically.

In addition, the opportunities for travel hacking with credit cards from America are far more lucrative than those from Germany, Austria or Switzerland.
👉 Read more in the article: Travel Hacking

⚠️ Important: Tax-free does not mean “duty-free”

Even if no US tax is due, there are a few forms you cannot avoid:

• Form 5472 (Foreign Owner Reporting) together with the
  
• “Pro forma” Form 1120 ( Disclosure of ownership structure and certain transactions)
  
• Annual Tax Report / Franchise Tax , depending on the state

⚠️ And – very important – your country of residence :
For example, if you officially move away from Germany, the so-called extended limited tax liability may apply for up to 10 years. (Yes, even if you no longer live there.)

4. Where is the best place to form an LLC?

There are over 50 states – and all have their own advantages and disadvantages.
However, three of them are particularly relevant:

🔹 Florida
✓ Practical for US-related business models
✓ Somewhat less anonymous, but very well positioned digitally

🔹 Wyoming
✓ Very affordable
✓ High data protection
✓ No annual reports for small businesses

🔹 Delaware
✓ Internationally recognized
✓ Strong legal certainty
✓ Popular with startups & investors

👉 Read more about the advantages and disadvantages in the article: Which US state should I choose for my LLC?

5. Our conclusion:

A tax-free US LLC is not a myth – but it is not a sure thing either .
If you know the rules of the game and use them strategically, it can give you a real advantage.

But please: Do n’t be blinded by TikTok promises .
Get advice, understand your own tax law – and build a structure that fits your life .

If you need support – with planning, establishing, or tax structuring your US LLC – please contact us.
We will help you step by step – transparently, legally and tailored to your situation.

👉 [Contact us now]