The US LLC Filing That Carries a $25,000 Penalty, and Cannot Be E-Filed

Forming a US LLC is easy, cheap and heavily marketed. What follows it is a filing calendar with real penalties, and it is marketed by nobody, because the people who sell the formation have no reason to be vivid about the consequences of having one.

So the typical Pakistani founder has a company, a bank account, and no clear idea that a filing exists until a year later. Everything below comes from the IRS, FinCEN or the state itself, and deliberately from no formation vendor.

This is the assumption that costs people money: the company made no sales, so there is nothing to report.

The reporting trigger is not income, it is a reportable transaction between the LLC and its foreign owner, and the regulations define that category broadly enough to include the things every dormant company does. Money moved from you into the company to open the bank account is a transaction. Paying the registered agent from your own funds is a transaction. Contributions to and distributions from the entity are named explicitly.

A genuinely dormant LLC that has never received or sent a single payment may fall outside it. An LLC that was funded, or whose fees you paid, does not.

This one changed, twice, and most of what you will read about it is out of date in a way that creates unnecessary alarm.

FinCEN issued a final rule published on 14 August 2026 that "permanently removes the requirement for U.S. companies and U.S. persons to report beneficial ownership information to FinCEN under the Corporate Transparency Act". Its guidance now states that "U.S. companies are exempt from the Beneficial Ownership Information (BOI) reporting requirements" and that "only certain foreign companies registered to do business in the U.S. must report BOI".

For a Pakistani founder the answer is therefore clean: a Wyoming, New Mexico or Delaware LLC is formed under US state law, so it is not a reporting company and files nothing. Your nationality is irrelevant to this test. What matters is where the entity was formed, not who owns it.

The narrow case where it would still bite is the reverse shape: a company formed outside the United States that then registers to do business in a US state. That is a different structure from the one most founders have.

An earlier interim rule from March 2025 reached the same practical outcome. The August 2026 rule makes it permanent, so if you are reading guidance that cites the interim rule, or worse the original 2024 regime with its deadlines and penalties, it is describing a world that no longer exists.

The online EIN application is closed to you: the IRS states that if "your principal place of business is outside the U.S.", you "apply by phone, fax or mail". That is not a workaround to route around, it is the documented process.

Fax from outside the US goes to 304-707-9471, and the IRS says processing is "generally within 4 business days". By post it is "approximately 4 weeks". There is also an international phone line on 267-941-1099, which is not toll-free.

The line that stops most applications is 7b, asking for the responsible party's tax number when you do not have one. The instructions answer it directly: "Enter foreign or N/A on line 7b if the responsible party doesn't have and is ineligible to obtain an SSN or ITIN."

And to clear up a persistent confusion: the EIN belongs to the company, the ITIN belongs to you. They are not substitutes and you do not need both by default. You need an ITIN when you personally have a US tax purpose, most commonly a personal return or a treaty claim. Filing the pro forma 1120 and 5472 for the LLC does not itself require you to hold one.

Whether you owe US income tax. That depends on whether your income is effectively connected to a US trade or business, which turns on facts this post cannot see. Having a US LLC does not by itself create a US tax liability, and does not by itself avoid one.

The 30 percent withholding figure you may have read also needs care. The IRS states that "most types of U.S. source income received by a foreign person are subject to U.S. tax of 30%", reducible by treaty. But for a disregarded single-member LLC there is no separate distribution to withhold on, because you are treated as earning the income directly. The 30 percent is not a tax on moving money from your LLC to your own account, and it is widely misdescribed that way.

And none of this covers the Pakistani side, which is a whole separate set of obligations: the foreign asset declaration, the State Bank position on holding a foreign company, and penalties of their own. Those are in the guides, where they are maintained against the Ordinance.