Forming a US LLC from Canada

US ownership

100%

US visit or SSN needed to form

No

Home-country regime

Canada Revenue Agency — Form T1135 (Foreign Income Verification Statement) is due when specified foreign property costs more than CAD 100,000 at any time in the year; whether your LLC interest is specified foreign property, or a foreign-affiliate share, is the adviser question on this sheet

Membership, year one

$399/yr

The sheet in one view

Forming the LLC is a state filing: Articles of Organization, a registered agent in the formation state, and a fee that in the three states surveyed below runs from $50 to $200 (all figures on this sheet are US dollars). No US address of your own, no US visit and no US tax number is required; the EIN follows on paper — fax, phone or mail — and for once in this Atlas the phone route keeps your hours, since Ottawa and the IRS's Eastern window share a clock. Canada imposes no approval on any of it. The Canadian work is reporting (§ 2) and classification: two questions to settle with a cross-border accountant before the company trades, because both are answered in your first Canadian return whether you settle them or not.

What Canada asks of you

The Canada Revenue Agency's page “Foreign Income Verification Statement” states the test exactly. Form T1135 must be filed by Canadian resident individuals, corporations and certain trusts that, at any time during the year, own specified foreign property costing more than CAD 100,000 — cost, not market value, tested at any point in the year, not just at year-end. The form is two-tiered: Part A is the simplified method for property costing more than $100,000 but less than $250,000 throughout the year, and Part B, the detailed method, applies at $250,000 or more. The CRA's page also lists what specified foreign property does not include — among the exclusions it names are property used or held exclusively in the course of carrying on an active business, and a share of the capital stock of a foreign affiliate. (A federal budget proposal would raise the $100,000 threshold for taxation years ending after 2026; a proposal is not the rule, and this sheet prints the rule the CRA currently publishes. Re-check the CRA page in the year you file.)

Where your LLC lands in that test is the adviser question. Whether an interest in your US LLC is specified foreign property counted toward the $100,000, or a share of a foreign affiliate and therefore excluded from T1135 (with its own reporting regime instead), turns on how Canada classifies the LLC and on your ownership percentage and facts. The companion classification is the one Canadian founders most often learn late: Canada has historically treated a US LLC as a corporation for Canadian tax purposes, whatever the IRS's disregarded default says — so the income's character, the credit for US tax, and the return's shape all follow the Canadian answer, not the American one. Neither answer is stated on this sheet, because both turn on your facts and your operating agreement. A cross-border accountant's hour, bought before formation, is what converts § 2 from a warning into a filing position.

What needs no adviser: the money's movement. There is no Canadian exchange-control approval to obtain and no authorised-dealer category to fit; your bank converts and wires as an ordinary international payment, and the paper trail it generates — conversion record, wire confirmation, the LLC's formation documents — is the file both the CRA's test and the US bank's onboarding will ask to see. Keep it from the first dollar.

Choosing the state from Canada

Canadian founders in this Atlas most often survey three states. New York ($200 to form, a $9 biennial statement) leads for the eastern corridor — the border state of the Toronto–New York axis, with the newspaper-publication requirement after formation priced on its dossier. Florida ($125 to form, $138.75 a year, report due by May 1) is the snowbird-economy default, where a Canadian founder's counterparties are most likely to include other Canadians' US businesses. Michigan ($50 to form, $25 a year in annual-statement duty, due February 15) is the quiet border pick — the Windsor–Detroit crossing's own state, and the cheapest five-year row on this sheet. If your reading keeps landing on Wyoming or Delaware, both are sold here on the same terms as every other state: this service covers 50 states + DC, at joining and at renewal, and their dossiers — Wyoming and Delaware — carry the verified fees and duties. Puerto Rico is not served by this Atlas.

The EIN from Canada

Your LLC needs its own Employer Identification Number, and you do not need an SSN or an ITIN first. The IRS's routes for an applicant whose principal place of business is outside the United States are: by phone on 267-941-1099 (not toll-free, Monday–Friday 6 a.m.–11 p.m. Eastern — for a founder in the Eastern time zone, that window is simply 6 a.m.–11 p.m. your time; from the Pacific, it opens at 3 a.m., which is the fax route's best advertisement), by fax to 304-707-9471 from outside the US (855-215-1627 from within it), or by mail to the IRS's EIN International Operation in Cincinnati. Fax returns the number generally within four business days when a return fax number is provided; mail takes approximately four weeks; and a new EIN can take up to two weeks to pass the IRS's TIN-matching systems even though it is usable immediately for a bank account, licences and paper returns. On Form SS-4, the responsible party is you — the individual who ultimately owns or controls the company — and line 7b reads “foreign” where that person has no SSN or ITIN and is not eligible for one. The full treatment — EIN basics, the routes compared, the annotated form, and what to do when the confirmation notice (CP 575, or Letter 147C if the original is lost) goes missing — is the EIN guide on this site. One EIN per responsible party per day, by any route — do not fax and phone the same application.

Banking and getting paid

Stripe's global-availability page, read on the survey date, lists Canada — the getting-paid question here is, again, comparative: a Canadian account on a Canadian entity, or a US account on the LLC for the US side of the business, each decided on its own file under the platform's published terms. What the LLC adds for a Canadian founder is specific and practical: US clients pay a domestic account on domestic rails, US marketplaces onboard a domestic entity, and the cross-border friction that remains is the currency conversion on the way home — a bank cost to compare, not a permission to obtain.

The bank file is the standard one in this Atlas — filed Articles, EIN confirmation, signed operating agreement, identification and address evidence matching character for character, a specific activity description — set out in full on this site's EIN guide. Canadian founders should expect one question other corridors meet less often: the US bank asking how the company relates to its Canadian owner and any Canadian business of the same name. Answer it with the § 2 file — formation documents, the accountant's classification note, the conversion and wire records — and the question closes. Keep the two businesses' books separate from day one: the T1135 cost test in § 2 is computed on your holdings, and a clean separation is what makes the computation a ten-minute exercise at return time.

The tax map in brief

A single-member LLC owned by a non-resident is disregarded for US federal income tax by default — and since 2017 that status carries an annual information filing: Form 5472 attached to a pro-forma Form 1120, reporting transactions with you, including your own funding of the company. The penalty the IRS states for a missing or late Form 5472 starts at $25,000. Multi-member LLCs file as partnerships instead. When a US payer needs your company's tax status documented, the form in the file is generally Form W-8BEN-E. The Canadian side of the map is § 2: residents report worldwide income to the CRA, the T1135 test runs on cost at any time in the year, and the LLC's Canadian classification — settled with your cross-border accountant before formation — decides the shape of every Canadian entry that follows. Form 5472 is treated in full on this site's EIN guide. None of this page is tax advice — it is the map of which questions exist, so none of them ambushes you in your second year.

The two-row calendar — home-country + US duty

Cost of ownership

All figures are US dollars. Compare five-year rows, not formation fees: Michigan carries the formation for $568 less than New York across five years, and New York still leads the eastern corridor on presence alone. Add the cross-border accountant's annual cost — in this corridor it is not a luxury line; § 2 is why.

Questions from Canadian founders

Can a Canadian resident own 100% of a US LLC?

Yes — no state in this Atlas requires a US co-owner, and Canada imposes no exchange-control permission on owning or funding a foreign company. The Canadian obligations are reporting and tax classification, in § 2.

Do I have to file Form T1135 for the LLC?

The CRA's published test: T1135 is due when specified foreign property costs more than CAD 100,000 at any time in the year. Whether your LLC interest counts toward that test — or is instead a foreign-affiliate share, which the CRA's page lists among the exclusions — is the classification question in § 2, to settle with your cross-border accountant before your first return.

Is the LLC taxed as a flow-through in Canada?

Do not assume so. The IRS's disregarded default is an American answer; Canada's classification of a US LLC is its own, and it drives the character of the income, the foreign tax credit and the return's shape. This sheet does not state your answer — § 2 explains why, and whose hour settles it.

Which EIN route should I use from Canada?

Any of the three in § 4 — and for Eastern Canada the phone route keeps office hours, 6 a.m.–11 p.m. Eastern. Fax returns the number generally within four business days with a return fax number on the form; mail takes approximately four weeks.

What do I owe each year?

In the US: the state duty for your formation state (table above), the $399 membership renewal from year 2 if you stay with us, and the federal information filing for your structure (§ 6). In Canada: your return on the worldwide-income basis, with the § 2 T1135 position your accountant has settled — tested every year, on cost, at any time in the year.

Sources: Canada Revenue Agency — “Foreign Income Verification Statement” (Form T1135 must be filed by Canadian resident individuals, corporations and certain trusts owning specified foreign property costing more than $100,000 at any time during the year; simplified Part A below $250,000, detailed Part B at $250,000 or more; exclusions include property used exclusively in an active business and a share of the capital stock of a foreign affiliate), canada.ca · IRS — “Employer Identification Number” and Instructions for Form SS-4 (Rev. December 2025), irs.gov · Instructions for Form 5472 (penalty), irs.gov · Stripe global availability, stripe.com/global, read 2026-11-07 · State fees and duties: data/state-fees.json, verified against official state sources 2026-11-03/04. Surveyed 2026-11-07. Education, not advice: this sheet is formation information, not legal, foreign-exchange or tax advice.