On this page, we discuss all the details about the free tax return form 5472, which is the most important issue regarding taxation, which is not generally emphasized by foreign LLC company owners residing outside the United States.
If you are a sole proprietorship (shareless, partnerless) LLC company owner in the USA, we discussed in depth in the Taxation in America article that you are not obliged to pay sales tax with any monthly statement.
But this issue is a little different because we all avoid seeing the truth, or those who constantly recommend starting a company may not tell you even if they know this. In this article, I will talk about an annual form to be filled out, as we have a company there even if we do not live in the USA every year.
Yes, our topic is Form 5472. A form that a sole-owner LLC founder must complete annually. Before getting into all the details, it should be underlined that this form is only required for sole proprietorships..
What is Form 5472? Why Fill in?
In 2017, a major tax reform was undertaken in the United States. They significantly changed the filing and disclosure requirements and also set penalties for wrong filing or disregard for filing.
In the period before the tax changes before 2018, S-Corporation company owners filled the 5472 form. Foreign and sole proprietorships (ie us) were not included.
This changed in 2018 and sole proprietorships were required to complete this 5472 form. The goal here is the amount of revenue that sole proprietorship LLCs earn in the US and where that revenue goes. The state does not charge any fees etc. just to learn it. obliged the company owner to fill out the form every year without requesting.
Incorporated LLCs, meanwhile, were exempted from this. If you are a multi-partner LLC owner, it is useful to investigate the subject because there may be some conditions according to the share share (according to the partnership percentage) as a result of the change. Since I do not own a multi-partner company, I did not research the subject, but I would say, do you research anyway.
Who Must Complete Form 5472?
One-member LLC company owners who do not live in the USA, do not have any dependent representatives, and who are not EBUS are obliged to report their money movements to the IRS every year with a simple form.
How and When to Complete Form 5472?
How to Filing: First, there is another form named Form 1120 along with Form 5472. In Form 1120, it is only necessary to fill in the name, surname, address and EIN information and leave the rest blank. This form is extremely simple. However, the original form must be filled in 5472 and filed to the state together.
When Should Forms Be Filed and Submitted? : Both forms must be sent together by April 15 of each year at the latest. If it cannot be filled by this date, the period can be extended until 15 October2 by requesting an additional extension.
Where To Send Forms? : Forms are sent to IRS via fax. Completed forms must be faxed to +1 855-887-7737 at 300 DPI or higher resolution before April 15 (can be made even earlier).
Are Forms Paid?
No, there is no charge to send the forms, just fill them in and fax them to the IRS.
Final Details About Form 5472
As I mentioned above, the 5472 form was previously required for S-Corporation type companies, but the IRS made changes to it and made an arrangement for LLCs. However, instead of changing the procedure completely, they used the form 1120 as a cover and sent it together with the 5472 in order to quickly activate the system.
- It is necessary to have an EIN number to fill in Forms 5472 and 1120
- The deadline for sending the forms is April 15, every year.
- Form 1120 to be partially completed (credentials, address and EIN)
- It is required to declare the value of the LLC as of 31 December on the form 5472
- FIt is necessary to write in orm 5472 the amount of money transferred to the owner of the LLC as of 31 December.
- It is also necessary to write the amount of money transferred from the owner of the LLC to the LLC as of December 31, on the form 5472.
- In addition, it is necessary to enter the tax identification number in the country where the owner of the non-US LLC is located to 5472.
Download here form 5472 and download here Form 1120
You can find the official instructions for Form 5472 here. You can also find the official instructions for Form 1120 here.
These forms cannot be filled online, they must be filled and sent by mail or fax. You can prepare and send the form to the contact information below as of the date I prepared this article.
Internal Revenue Service
1973 Rulon White Blvd.
M/S 6112, Attn: PIN Unit
Ogden, Utah 84201
It is risky to fill out this form and when it is filled incorrectly, it is treated as unsent, so if you need professional support on this issue, you can hire a tax lawyer at www.ustax.bz.