The EIN and IRS forms · A term for founders abroad
What is a reportable transaction?
Form 5472. Any exchange of money or property between a US company and its foreign owner that goes on Form 5472, including the money used to form the company.
Checked against the IRS's instructions and the states' own rules. Reviewed by Saais Patel, compliance reviewer.
Term 82 of 105 in the glossary, filed under R.IRS: instructions for Form 5472
Reportable transaction, for a founder abroad.
Contributions, distributions, loans and payments for anything between the company and a foreign owner of 25% or more are reportable on Form 5472. The IRS counts amounts paid to form or dissolve the company, so the fees you paid to set it up count too. That's why a company with no sales still has something to report.
The form asks for each year's totals by type, not a list of every transfer. Keeping the company's money separate from yours makes those totals a matter of adding up statements.
Sources: IRS: instructions for Form 5472.
Read next · guide · 5 minForm 5472 and the pro forma 1120, explained for a foreign-owned LLCWhat founders ask next.
- Is money I put into my LLC a reportable transaction?
- Yes. A capital contribution from a foreign owner is reportable, as is any loan, and any distribution back to you.
- Do I report every transfer separately?
- No. Form 5472 asks for totals by category for the year, with a short statement describing contributions and distributions.
03 · See also
- The EIN and IRS formsForm 5472The yearly IRS information return a foreign-owned US company files to report transactions with its foreign owner, with a $25,000 penalty for missing it.Read the term
- The EIN and IRS formsEINThe nine-digit tax number the IRS assigns to a business, and the first thing every US bank, payment processor and marketplace asks for.Read the term
- The EIN and IRS formsSSNThe US personal tax and benefits number for citizens and people authorised to work; not something a founder abroad has or needs to own a US company.Read the term
- The EIN and IRS formsITINA personal US tax number for people who must file a US return but can't get an SSN; not needed to form a company or to get its EIN.Read the term
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