Question about Being a Canadian But Owning 50% of Usa company

**Amero** · 12-05-2009 06:33 AM

Hi i live in canada im expanding my network into the usa .. I have a potential partner in usa . He wants to open a company but i want to be half owner .

is this possible with me being canadian . I would not be working / living / doing anything for this company he is just distrubting my products but i want some control .

Is this possible ?

**dslackman** · 12-05-2009 07:18 AM

Sure it's possible. Talk to a lawyer and get an iron-clad agreement written. This protects you and your ownership stake. Make sure you spell out all issues so there are no misunderstandings.

Best of luck,

**GlobalWealth** · 12-05-2009 08:39 AM

This is certainly possible. Anyone can be an LLC member, or corporate shareholder of a US based company. Our firm frequently forms US LLC's for non-US nationals. It is important to form the LLC in the correct state and have a solid operating agreement.

**cg410** · 12-06-2009 09:28 PM

Note that it is not possible if it's a US S Corp. It would need to convert to a C Corp before you could hold shares.

**LLCtaxes** · 01-06-2010 05:21 PM

Nor is it possible to set up an LLC and tax it like an S Corp in your situation.

**abergmanesq** · 01-28-2010 04:35 PM

A Canadian may be a member of an LLC. However, if your LLC will be engaged in a U.S. Trade or Business you will be subject to state and federal income tax on the U.S. source income. You should receive a credit for any U.S. tax paid when you file your Canadian income tax return. You should check out the Canadian- U.S. income tax treaty to determine if you will have a Permanent establishment in the US (you would only be subject to state or federal income tax if you are deemed to have a Permanent Establishment). Note - the LLC will have to file a U.S. Partnership tax return and you will be given a K-1, which the IRS will also receive (most foreigners are not thrilled about providing any info to the IRS).

You should definitely get a well drafted LLC Operating Agreement - check out MyLLCAgreement.com - the quality of their Operating Agreements are excellent.