Delaware LLC & federal tax.

[MikeJigsaw]

Good afternoon to everybody. I have a question about Delaware LLC.

If I set up a company in Delaware, will the company income or the dividends will be subject to federal U.S. tax?
I am tax residence of Bulgaria and the services that will be provided through LLC, will be outside of USA.

I would appreciate some assistance, thank you in advance.

 

[neweraoffshore]

Sole membership LLCs will be taxed through (Like S-Corps). So your regular income tax in‌ Bulgaria will apply. There is only a federal flat tax of 250$/year. So should be‍ 10% in your case, which is a pretty good and fair deal.

 

[Sols]

That's only if Bulgaria recognises the LLC‍ as a pass-through entity (or doesn't bother to look into it). UK and Canada for⁠ example treat LLCs as taxable companies. It's probably untested in most jurisdictions, and interpretation may⁤ vary depending on how the LLC is effectively controlled and managed.

Odds are this is⁣ uncharted territory, where the US aspect is clear (no tax would apply under normal circumstances)⁢ but what happens in Bulgaria is uncertain.

 

[MikeJigsaw]

In Bulgaria the dividends from foreign companies are taxed with 5%.⁢
But my question was if I must pay a federal tax in any case in︀ U.S.

 

[Golden Fleece]

As a general rule, the answer is no.
https://ustax.bz/services/non-us-entrepreneur-services/

 

[MikeJigsaw]

Thank you very much.