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Info LLC Presence Income Results

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Understanding US LLC Taxes

ECI - Effectively Connected Income

Income that is connected to a US trade or business. This includes income from services performed in the US, or income from a business with US presence (office, employees, inventory).

FDAP - Fixed, Determinable, Annual, Periodical

Passive income like dividends, interest, royalties, and rents. Subject to 30% withholding by default, but tax treaties can reduce this rate significantly.

Tax Treaties

The US has tax treaties with ~65 countries that can reduce or eliminate withholding on certain income types. File Form W-8BEN to claim treaty benefits.

State Taxes

Some states have income tax, franchise tax, or both. Wyoming and Nevada have neither. Delaware has an annual franchise tax but no income tax for non-residents.