How to Start a Business in the U.S.: Complete Guide for Foreigners

Expanding into the U.S. market is a unique opportunity for Spanish-speaking entrepreneurs facing tax and regulatory barriers in their home countries. The United States, with its flexible system and access to capital, is a strong option for those looking to protect their assets and optimize taxes.

This guide breaks down the key steps to start a business in the U.S., explains specific advantages, and compares the process with other Latin American and European countries, highlighting why the U.S. is the preferred destination for international entrepreneurs.

1. Why Start a Business in the U.S.? Key Benefits

The United States is one of the most favorable destinations for starting a business, especially when it comes to maximizing protection and growth opportunities. With a GDP of $25.5 trillion in 2023, the U.S. market offers a dynamic economic environment and superior asset protection structure.

• Asset Protection: Business structures in the U.S., such as the LLC and Corporation, offer protection against debts and lawsuits, an advantage over countries like Colombia, Spain, Argentina or Mexico, where personal assets can be at risk if financial issues arise.
• Tax Advantages: The U.S. allows entrepreneurs to choose how to be taxed, contrasting with countries like Ecuador and Costa Rica, where tax rates exceed 20%, and deductions are limited. States like Wyoming and Florida offer more flexible tax structures.
• Access to Financing and Capital: The U.S. financial market provides over $7 trillion in business financing annually, supporting growth for new businesses—a challenge in countries like Honduras or Ecuador, where financing options are more limited.

2. Key Steps to Start a Business in the U.S.

Here are the essential steps to start your business in the U.S., each designed to ensure a straightforward and effective setup process:

1. Choose the Business Structure: Decide between LLC, Corporation, or S-Corp, each offering specific benefits based on your growth and tax needs.
2. Register in the State: Choose the state that best suits your business goals. Some states, like Delaware and Wyoming, offer tax and privacy benefits.
3. Designate a Registered Agent: Every business in the U.S. needs a registered agent to receive legal documents on the company’s behalf.
4. Apply for an Employer Identification Number (EIN): Issued by the IRS, this number is essential for managing taxes and opening a bank account.
5. Open a Bank Account: A U.S. bank account simplifies transactions and allows access to local financial services. Many banks require an in-person visit.

3. Choosing the Ideal Business Structure in the U.S.

Each type of business structure in the U.S. offers unique benefits, and choosing the right one can make a difference for your business. With options like the LLC, Corporation, and S-Corp, the U.S. allows international entrepreneurs to adapt their tax and legal structure based on growth goals.

• LLC (Limited Liability Company): The LLC is a favorite for foreign entrepreneurs, offering asset protection and optional tax burden, allowing companies to report income without double taxation.
• Corporation (C-Corp): Ideal for growth-oriented companies seeking investors. A C-Corp allows businesses to access capital through the sale of shares, an advantage over more restrictive markets like Argentina or Spain.
• S Corporation (S-Corp): Provides corporate benefits without double taxation, useful for smaller businesses, though it’s limited to U.S. citizens or residents.

Compared to countries like Colombia or Mexico, where business options are less flexible, the U.S. allows companies to adapt quickly to a changing market while maintaining a secure and credible framework.

4. Where to Register Your Business? A Comparison of Key States

Each U.S. state offers different advantages and benefits for foreign companies. Below is a comparison of the most popular states to start a business:

• Delaware: Known for its specialized judicial system, Delaware is ideal for large companies seeking legal stability and privacy. Delaware’s laws allow a flexible structure, benefiting both corporations and startups.
• Wyoming: This state is ideal for those looking to keep ownership information private, as it protects personal data in public records. Wyoming offers affordable maintenance fees and simplifies the process for entrepreneurs seeking low compliance costs.
• Florida: Popular among Spanish-speaking entrepreneurs, Florida has a strong Hispanic market and tax advantages. The absence of state income tax makes it attractive for family and investment companies.

When choosing the ideal state, entrepreneurs should consider maintenance costs, privacy, and ease of establishing themselves in the local market.

5. How Much Does It Cost to Maintain a Business in the U.S.? Compliance and Maintenance Costs

Maintaining a business in the U.S. is affordable, but there are key costs and obligations to consider:

• State Fees and Business Licenses: Annual renewal costs and licenses vary by state. Some states, like Wyoming, are more economical, while others, like California, may have higher fees.
• Tax Filing: All companies must file federal tax returns with the IRS. Some states, like Texas and Florida, don’t impose additional corporate taxes.
• Sales Tax: If you sell taxable goods or services, you’ll need to collect and report sales tax, with rates and frequency varying by state.

Complying with these obligations ensures your business remains compliant and avoids potential penalties.

6. U.S. vs. Other Countries: Business Formation Comparison

Starting a business in the U.S. has advantages over other international jurisdictions regarding taxes and administrative flexibility.

• Argentina: Argentine entrepreneurs face tax rates over 35%. In the U.S., the tax system allows flexibility, avoiding double taxation with structures like the LLC.
• Costa Rica: Starting a business in Costa Rica involves high tax rates, and administrative processes can be lengthy. The U.S., by comparison, offers a structure that allows operations to begin within days.
• Latinos Residing in the U.S.: Many Latinos residing in the U.S. find that establishing an LLC or Corporation provides tax and commercial benefits, avoiding tax limitations in their home countries.

7. Tax Benefits, Market Access, and Scalability in the U.S.

One of the U.S.'s greatest appeals is its business-friendly tax structure and growth opportunities. With a consumer market of over 330 million people and a network of global trade agreements, the U.S. stands out as the ideal business center.

• Tax Flexibility: States like Delaware and Florida allow companies to choose their taxation method, facilitating tax optimization.
• International Access: A U.S.-based business enhances credibility and facilitates international trade, an advantage limited in other countries. With free trade agreements across the Americas and Asia, the U.S. allows foreign companies to operate globally with a secure legal framework.
• Ease of Scaling: Unlike developing countries, the U.S. has a robust business ecosystem that supports expansion domestically and internationally.

8. Success Stories: Latin American and European Entrepreneurs in the U.S.

• Carlos Mendoza, a Mexican entrepreneur, founded a tech company in Florida through an LLC. Thanks to tax flexibility and access to U.S. investors, his business expanded quickly and efficiently compared to Mexico’s tax limitations.
• Lucía Martínez, from Colombia, created a consulting business in Delaware, where asset protection and legal stability allowed her to reinvest profits without personal risk, which is difficult in Colombia, where personal assets may be affected.
• Javier Ortega, a Spanish entrepreneur, launched an e-commerce business in Wyoming. With a flexible tax structure and access to the U.S. market, he expanded operations and reached customers worldwide, something that would be more restrictive in Spain.

9. Ready to Start Your LLC in the U.S.?

Starting a business in the U.S. offers numerous benefits, from asset protection to tax optimization and access to a global market. With Prodezk, you’ll receive the guidance you need at each step, ensuring your business is correctly established and compliant with legal requirements.

Contact us for a personalized consultation and discover how to successfully start your business in the U.S.

Frequently Asked Questions (FAQ)

• Can I start a business in the U.S. without being a resident?
  Yes, the U.S. allows foreign entrepreneurs to start businesses without residency or citizenship.
• How long does it take to start a business in the U.S.?
  In most states, registration takes between 1 and 5 days. In comparison, it can take weeks or months in Latin American and European countries.
• What’s the best structure for foreign entrepreneurs?
  The LLC is ideal for flexibility, while the C-Corp is suited for companies seeking significant investment.