Taxes & Ongoing Filings

Every U.S. business must file certain federal tax forms with the IRS each year. The exact forms and requirements depend on your entity type, ownership structure, and income.
​

We have noted down all of the most common and important federal tax forms below:

1. Federal Income Tax Return – Every U.S. business is required to file a yearly income tax return. The form and deadline depend on how your business is structured and taxed.

2. Form 5472 (for Foreign-Owned Single-Member LLCs) – If your LLC has one owner and that owner is not a U.S. person, you must file Form 5472 along with a pro forma 1120. This form discloses reportable transactions between the business and its foreign owner.

3. Withholding Taxes (If Applicable) – If your business pays foreign individuals or entities, you may need to withhold and report those payments using Forms 1042 and 1042-S.

4. Payroll Taxes (If You Have U.S. Employees) – Businesses with employees must withhold and pay employment taxes like Social Security, Medicare, and federal income tax, typically reported using Forms 941, 940, W-2, and W-3.

5. Estimated Quarterly Taxes (for C-Corps and Profitable LLCs) – If your business is generating income, you may be required to make estimated tax payments throughout the year using Form 1120-W.

6. Form 1040-NR (For Individual Foreign Owners, Not the Business Itself) – This is not a business form but is often required for non-U.S. individuals earning U.S.-sourced income.

Still unsure which forms apply to your company? Our team can help you determine your filing obligations and keep you compliant.

The deadline for your federal tax return depends on your business structure:

If the due date falls on a weekend or holiday, the deadline is extended to the next business day. You can also request an extension (usually for 6 months_ but the extension only delays the filing, not the payment.

Keep in mind: If you’re a non-U.S. resident, you may also need to file Form 5472 and other disclosures depending on your structure.

Missing a U.S. tax deadline can lead to penalties, interest charges, and potential compliance issues with the IRS or state authorities. The specific consequences depend on your business structure, what forms were due, and whether you owe any taxes.

If you fail to file your federal return on time, the IRS typically charges a failure-to-file penalty. This is usually 5% of the unpaid taxes for each month the return is late, up to a maximum of 25%. Even if you file late but don’t owe any tax, penalties might still apply unless you have a valid reason and request relief.

For businesses that owe taxes and do not pay on time, the IRS applies a failure to pay penalty. This is generally 0.5% of the unpaid tax per month, and interest is also added until the balance is paid.

In addition, missing informational filings, such as Form 5472 (for foreign-owned U.S. entities), can result in a minimum $25,000 penalty per form, even if no tax is owed.

To reduce or avoid penalties:

Late filings can also jeopardize your company’s good standing or cause issues when applying for financing, business visas, or opening bank accounts. It’s best to act quickly and consult a tax professional if you’ve missed a deadline.

Form 1120 and Form 1120-S are U.S. federal income tax returns used by corporations, but they apply to different types of entities.

If you’re running a Delaware or Wyoming C-Corp or formed your company with plans to raise venture capital, you’ll likely need to file Form 1120. If you’ve elected S-Corp status with the IRS, then Form 1120-S applies instead.

These forms are typically due by March 15 for S-Corps and April 15 for C-Corps (unless an extension is filed). Filing the correct form on time is critical for staying compliant and avoiding penalties.

Form 5472 is a U.S. federal tax form used to disclose certain transactions between a U.S. company and its foreign owner or related foreign parties. It’s primarily required for corporations with at least 25% foreign ownership, including single-member LLCs owned by non-U.S. residents that are considered disregarded entities for tax purposes.

If you’re a non-U.S. resident who formed a U.S. LLC, you’re likely required to file Form 5472 along with Pro Forma Form 1120, even if your business made no income during the year. This applies if your LLC had any reportable transactions (such as receiving capital contributions, paying for services, or transferring funds) with its foreign owner.

Here’s when Form 5472 is generally required:

Failing to file Form 5472 correctly and on time can result in a $25,000 penalty, with additional penalties for continued non-compliance. This is one of the most important filings for non-resident business owners to be aware of.

Form 1040-NR is the U.S. tax return specifically designed for non-resident aliens who earned U.S.-sourced income. You need to file it if you are not a U.S. citizen or green card holder, and you received income from U.S. sources, such as:

Even if your U.S. company had no income, you may still be required to file 1040-NR if you are considered engaged in a U.S. trade or business.

Non-residents who own LLCs treated as partnerships or disregarded entities may need to file Form 1040-NR to report their share of the business’s U.S. income. In most cases, non-resident single-member LLC owners do not pay personal income tax unless the business is considered “effectively connected” with a U.S. trade or business, but they may still need to file for compliance purposes.

If you’re unsure whether 1040-NR applies to you, a tax professional can help evaluate your activity and ensure you meet all requirements.

Being “engaged in a trade or business in the United States” (ETBUS) means you’re actively conducting activities within the U.S. that generate income. For non-U.S. residents, this status determines whether you need to file Form 1040-NR and potentially pay U.S. income tax.

You’re generally considered engaged in a U.S. trade or business if you:

Merely owning stock in a U.S. company or receiving passive income (like capital gains or interest) usually does not count unless those earnings are connected to a U.S. business activity.

If you determine that you’re engaged in a U.S. trade or business, you’ll likely need to file Form 1040-NR. To complete the form, you’ll typically need:

Depending on your business structure, you may also need to file Form 5472, Form 1065, or other related forms along with your 1040-NR.

Form 1065 is the U.S. Return of Partnership Income. It’s used by partnerships and certain LLCs to report the business’s income, deductions, and other financial information to the IRS. While the partnership itself doesn’t pay federal income tax, Form 1065 helps the IRS understand what the business earned and how that income is distributed to its partners.

You need to file Form 1065 if:

Alongside Form 1065, the partnership must also issue Schedule K-1 forms to each partner. These forms detail each partner’s share of profits, losses, deductions, and credits, which the partners then report on their personal or business tax returns.

If you’re a non-resident partner in a U.S. partnership, you’ll likely also need to file Form 1040-NR to report your share of income.

Schedule K-1 is a tax form issued to individuals who are partners in a partnership or shareholders in an S corporation. It outlines each person’s share of the business’s income, deductions, credits, and other relevant tax items for the year.

If you are part of a partnership or an LLC taxed as a partnership, your business will file Form 1065 with the IRS. Alongside this, it will generate a Schedule K-1 for each member or partner. This form essentially breaks down how the profits (or losses) of the business are allocated among the owners based on their ownership percentages or partnership agreement.

Each partner uses the information on their Schedule K-1 to report their share of the business’s income or loss on their personal or corporate tax return. Even if the business didn’t distribute any actual cash during the year, you may still owe taxes on the income allocated to you in the K-1.

Non-U.S. residents who receive a K-1 may also need to file Form 1040-NR, depending on the source and type of income reported.

Yes, in many cases, you still need to file a tax return for your U.S. business even if it didn’t earn any income during the year.

The IRS requires annual filings for most registered entities, whether they are active or not. For example, LLCs with a single member owned by a non-U.S. resident must file Form 5472 with a pro forma 1120, even if there was no income. Failing to do so can result in steep penalties (starting at $25,000).

Partnerships and corporations (LLCs taxed as corporations or partnerships, C-Corps, S-Corps) also need to file their respective tax returns regardless of business activity. These returns indicate that the entity is still active and in good standing with the IRS.

Even if no tax is due, filing is often required for compliance purposes. Not filing can lead to fines, the loss of good standing, or trouble with future banking and licensing. Always consult with a tax professional to determine the filing requirements for your specific structure.

Filing a federal tax return as a non-resident U.S. business owner involves a few additional steps compared to U.S. residents, but it’s fully possible with the right documents and processes in place.

First, determine which forms apply to you based on your company’s structure and activity. For example:

You don’t need a Social Security Number (SSN) to file, but you may need an ITIN (Individual Taxpayer Identification Number) to complete certain filings. Clemta can help you apply for one if needed.

Once you’ve determined the right forms, you can file by mail or work with a U.S.-based tax professional. If you choose to work with us at Clemta, we can prepare and submit everything on your behalf, ensuring you remain fully compliant with IRS requirements.

Keep in mind: U.S. tax returns are typically due by April 15 (or March 15 for partnerships and S-Corps), but extensions are available.

The taxes your U.S. company owes at the state level depend on where your company is registered and where it has nexus (a sufficient connection to that state, such as a physical presence, employees, or significant sales activity).

Here are the most common state-level taxes that may apply:

Even if your company is formed in a tax-friendly state like Wyoming or Delaware, having customers, contractors, or inventory in another state could create tax obligations there. It’s important to review your business operations regularly and understand where your company might be considered to be “doing business.”

If you’re unsure about your state-level responsibilities, Clemta can help assess your company’s footprint and assist with registrations or filings where needed.

Every U.S. state has its own deadlines for filing reports and paying fees. These filings help keep your company in good standing. Depending on your business type and where it’s registered, you may need to file an annual report, pay a franchise tax, or both.

Here are some common examples:

Missing these deadlines can lead to penalties or even cause your company to lose its good standing. Be sure to keep track of your deadlines and get help if needed. Clemta can handle these filings for you.

IRS filings are federal tax obligations, while state filings are specific to the state where your company is registered or operates.

The IRS (Internal Revenue Service) oversees federal taxes, such as income tax returns (like Form 1120 or 1040-NR), Form 5472 for foreign-owned entities, and other federal-level documents. These apply regardless of which state your business is in.

State filings, on the other hand, vary depending on the state and typically include franchise taxes, annual reports, and sometimes state income or sales tax returns. Each state sets its own deadlines, fees, and requirements. Some states, like Delaware and California, require a separate annual franchise tax filing even if you had no income.

To remain compliant, your business must fulfill both federal and state filing requirements, and missing either can result in penalties or a loss of good standing.

If you don’t file your business taxes, you may face serious consequences at both the federal and state levels. The IRS and state agencies can impose late filing penalties, interest on unpaid taxes, and even more severe legal actions if your filings are significantly overdue.

For example, the IRS may charge a penalty of 5% of the unpaid tax for each month your return is late, up to a maximum of 25%. If your business owes taxes and doesn’t pay, interest accrues daily until the balance is settled. In some cases, failing to file can also result in the loss of your company’s good standing, making it harder to open bank accounts, apply for credit, or maintain compliance.

At the state level, not filing required documents like franchise taxes or annual reports can lead to administrative dissolution, meaning your company is no longer legally recognized. This could also trigger additional fees and make it more complicated to reinstate your business later.

To avoid these issues, it’s essential to keep track of your deadlines and ensure your returns are submitted accurately and on time, even if you had no income during the year.

If you made a mistake in your tax filing, don’t panic. Most errors can be corrected by filing an amendment with the IRS or the relevant state authority. The process depends on the type of return you filed and the nature of the mistake.

For federal tax returns, you can file an amended return using Form 1040-X (for individuals) or by refiling the appropriate business form with corrected information. For example, if you filed Form 1120 or 1120-S, you would submit a corrected version marked as “Amended.” If you filed Form 5472 and made an error, you’ll need to refile it with the accurate data and include a written explanation of the correction.

It’s important to act quickly. While simple math errors are often corrected automatically by the IRS, other issues, such as incorrect income reporting, filing status, or omitted schedules, require formal amendments. In most cases, you have up to three years from the date of the original filing to submit corrections and claim any potential refunds.

If your mistake led to an underpayment, paying the corrected amount as soon as possible helps reduce interest and penalties. And if you overpaid due to the error, you might be eligible for a refund once the correction is processed.

For state filings, procedures vary, but most states allow for amendments and have similar deadlines. It’s a good idea to consult a tax professional or service provider to ensure everything is done correctly and your compliance is restored without further complications.

Yes, even if your U.S. business didn’t operate or earn any income during the year, you are generally still required to file a tax return to remain compliant.

For federal filings, most business entities have an annual obligation to submit returns—even with zero activity. For example:

Failure to file can lead to late penalties, even if there was nothing to report. Filing a “zero activity” return helps you maintain good standing with the IRS and avoid fines or compliance flags.

On the state level, your business may still need to file annual reports or pay minimum franchise taxes, depending on where it was incorporated. For instance, Delaware and California impose yearly franchise tax requirements, even on inactive companies.

To stay in good standing and avoid unnecessary issues, it’s best to file the required forms, even if your business had no activity during the tax year.

Yes, you can file taxes yourself, but whether you should depends on your business structure, tax obligations, and your comfort with U.S. tax rules.

If you have a simple setup, like a single-member LLC with no U.S. income or activity, you might be able to handle the filing yourself, especially if you’re familiar with forms like 5472 and 1120 (pro forma). However, even in these cases, filing incorrectly can lead to penalties.

For more complex structures such as multi-member LLCs, corporations, or businesses with U.S. sales, employees, or inventory, it’s strongly recommended to work with a CPA or tax professional. They’ll help ensure you’re filing the right federal and state forms, taking advantage of tax deductions, and staying compliant with deadlines.

If you’re a non-U.S. resident, a CPA experienced in international filings can also guide you through unique requirements, like avoiding double taxation or navigating treaty benefits.

In short, it’s possible to file on your own, but many founders choose to work with a CPA for peace of mind and full compliance, especially as their businesses grow.