Every person dreamt at least one time to start their own business. The process itself can be considered an exciting venture, but if you are a Canadian in the USA and you plan to do it, then you can find the process as quite scary. Changes happen every day, especially when it comes to rules for foreigners to grow a business in the USA, and you find difficult to keep up with them. You may even ask yourself sometimes, if this is the path you want to follow, and if you should build your business here, or you should go back home. Well, the first thing you should keep in mind is that the United States is a welcoming state when it comes to foreign investors, and it will continue to be for the years that are about to come. Also, you will not have any difficulty if you want to incorporate your business into their industry, because there are various resources you can take advantage of. Here are the steps that will help you become a wealthy Canadian in the USA.
Check the types of entities you can open in the US without being a resident
In case you want to open a business in the USA, then you should know that you can choose from two different types of entities: corporation and Limited Liability Company. Also, you have the possibility to opt for an additional variant the S-Corporations. The majority of people will probably advise you to opt for the C-Corp option, but there are more advantages you will benefit from if you will decide to open an LLC. The main one is that it has a limited liability form, and this means that the members funding it are protected from personal liability when it comes to business actions and decisions. This means that your personal assets will not be in danger in case you make a bad investment.
Another great benefit you will have if you will opt for an LLC, instead of a C or S-Corp is that you will not have to deal with the same strict record-keeping rules. But multiple new companies founded by foreigners have the form of a C-Corporation, because this form offers you the possibility to expand the business by offering you an unlimited stock. Also, as a foreign investor you may find this option more suitable, because it can protect you from the close IRS involvement.
Do you need a visa if you want to open a business in the USA?
Well, the answer is yes, but you have multiple options from which you can choose. The most popular one for Canadians is the E-2 visa. If you want to obtain this type of visa then you will have to meet certain requirements. You have to be a citizen of one of the states that are members of the Treaty of Friendship Commerce, or Navigation with the USA. And as you already know Canada is part of the treaty, so you will have no issues to meet this criterion.
The second criterion requires you to have invested or to plan to invest a large sum of money in a USA company. There is not a certain amount of money established by the rules at the present moment, but in order to have chances to get the visa you should prove that you plan to invest more than $100k. The rules state that it has to be a substantial part of your personal funds. The final criterion asks you to show that you are able to control share of your company.
This visa also offers your spouse the possibility to get a work visa, and it will be renewed indefinitely.
Consider taking advantage of the Delaware trust
It does not matter where your home state is, you can benefit from the Delaware trust. Why should you consider this option? Well, because the diversity and power of the US is enormous when compared with the one of states like Canada. If you want to find more about the process of purchasing 1031 exchange properties for sale, then you should know that you will have the advantage of getting into a business that will last. It will offer you the possibility to preserve your family funds and you will also benefit of asset protection.
What company registration implies?
Every state in the US requires different steps in the registration of the company. Also, the steps differ according to the type of entity you want to establish, because if you want to form an LLC, you will have to follow different steps than if you want to form a C-Corp. The Delaware process is the right model to check if you want to know what the basic steps are.
- You will have to choose a unique name for your business, one that it is not already registered. If you want to check the name, then you can use the trademark database offered by the US Patent and Trademark Office.
- You have to check if you or the named company agent are able to receive your business legal documents.
- You will have to fill out a certificate of incorporation. In this document you will have to state the name of the business, your address, or the address of the company’s agent, the name and legal address of the incorporator, and the values of the authorizes shares. The fee for this document starts from $89 and it can raise according to the type of company and amount of stock issued.
- You will have to pay a franchise tax and to file an incorporation report
- You will have to get an employer identification number, because this is the only way you will be able to hire employees, pay taxes, open a bank account for your business and obtain other licenses required by the process.
If you need further help in the process, then you can check the resources offered by the US Small Business Administration, because they provide comprehensive information foreigners could use.