How can Foreigners Start a Business in the USA? Step-by-Step Guide

There is no doubt that you grab ample business opportunities and prospects in a developed country like the United States. It ranks as the third-largest country in the world (with reference to landmass) and is known for its affluence, abundant resources, and a developed economy. 

If you are determined and passionate to become an entrepreneur and want a great market to thrive in, then there is no other place as the United States. Do you still think that you will be treated as an outsider or you would be living in unknown territory? Then, let us inform you that you won’t be the first in the race or alone in this struggle.

As per the USDA study, foreigners in the USA own 28.3 million acres of farmland. Even if 5 percent of the world’s population lives in the United States, they own more than 25 percent of the worldwide economic output. 

As a foreign citizen, you might be wondering whether you are allowed to conduct a legal business in the USA and whether you can seek chances of growth or not. Yes, of course. You can visualize yourself as an entrepreneur in this country, and you can seek every advantage of living in an economic state like the US. 

Legendary examples of foreign start-ups that expanded in the United States 

  • Mindstrong
  • Capsule 
  • Modern Health 
  • Attentive 
  • Nuvia 
  • Brex 
  • FIG 
  • Bungalow 

You can find more names in this list for inspiration. The success story of each business is worth reading as they have achieved amazing heights by doing business in a totally new land. But in this post we will elaborate on the procedure to start a business in the country by foreigners. 

Procedure a foreigner has to follow systematically to set up a business in the United States: 

1. Think of a profitable venture that can grow in the United States

You have to be innovative when you decide to open a business in this country. Remember that it is a growing market and a dynamic place too. People come with bright ideas on a daily basis, and you cannot pitch for a random idea that already thrives or does not have requisite potential. Hence, take your time and brainstorm for the best business ideas. Your idea should not only generate profit for yourself, but you should also enrich other people’s lives. 

Some of the lucrative business ideas are cleaning and housekeeping services, education sector, digital marketing, pet sitting and pet grooming, delivery services, fitness, e-commerce distribution, painting, and many more. 

2. Be fluent in English

Remember that English is the official language of the United States, and you would be dealing with the other business parties, investors, team members, staff, and creditors in this particular language. When you are a foreigner, you know that English is your second language, and so, you will need to be fluent in it, no matter what. It doesn’t mean you have to pick up the American accent, but you ought to know the basics of reading, writing, understanding, speaking American English. Also, know that there is a considerable difference between American and British English, and hope you know it well. 

3. Complete the legal formalities – seek the federal approvals

The best thing is that you don’t need a green card or be a permanent citizen of this country to open a business place. But you need to complete the relevant visa formalities. You have two options: 

  1. E-2 Treaty Investor Classification – In this category, the non-citizen investor should be from a country having peaceful connections with the US, should own substantial capital in a US company, and must be 50% owner of the company. 
  2. EB-5 Visa Classification – Foreign entrepreneurs who are willing to invest $1.8 million and more in the company and create full-time job opportunities. 

4. Choose a business structure that aligns with your requirements 

Foreigners have limited options of business structures to choose from because of the restrictions laid down by the US government. You can choose from C Corporation or LLC. Note that foreigners are not allowed to form S corporations, but it is okay as you have the other two options. Also, the registration work depends upon the state regulations in which you initiate the business transactions. 

5. Be ready with all the business-related requirements before you step into the business venture 

It could be an overwhelming task to set up a realistic business venture in another country. First, you ought to know that the process is lengthy and requires a great deal of your patience. It might take five weeks or more to complete this process and start your normal business operations in the US. But before you do the setup, you are supposed to be ready with the following requirements: 

  1. Approach a reliable agent – He is the authorized person who takes care of the LLC registration. Ensure that the person you approach is a genuine one as he knows confidential details about your business. He is also known as the Registered Agent. 
  2. Seek a physical business address – Even if business owners try to evade this requirement by filling up the agent’s address in the column, we suggest getting an authentic physical address for your business. It might cost you a certain amount per year, but it will avoid future legal trouble. 
  3. Furnish company details to the Agent – You need to pay requisite fees to the agent and submit 2-3 names of your proposed company, personal details, and business details. 
  4. LLC registration – The Agent forwards your details, and the overall registration process takes about 72 hours. 
  5. Get an EIN – It is a number allotted to the business entities as a tax file or social security number. This number is required to do the next bank account opening process. 
  6. Open a bank account – It is free and easy to open a bank account, provided you have the EIN and other business documents with you. Moreover, you can choose from the best alternatives – Mercury and TransferWise. 
  7. Set up a payment processing platform – A better payment processor would be Stripe or 2Checkout, or you could even use a virtual desktop platform like Amazon WorkSpaces. This is an essential requirement to process credit card payments. 
  8. Establish a robust accounting system – You can either hire an accounting service provider or invest in an in-house one, depending upon the budget you have. 

6. Seek the requisite approvals and licenses as per the jurisdictions. 

Apart from the LLC registration, a company formed by non-citizen foreigners is also required to seek the necessary licenses and permits to legally carry out the business. It depends upon the industry and jurisdiction in which you operate and the type of business activities you carry out. 

Briefly, you can consult with an expert or seek a mentor’s advice if you are a foreigner and want to invest or start a business in the USA. It is not easy to understand the rules and regulations of a country, and hence, the role of a business consultant and a Registered Agent is of crucial importance. So, go through the above formalities, and be ready to accomplish your dream of opening up a business in the United States. 


1. What are the steps for starting a business in the USA as a foreigner?

There is no special process for starting a business in the USA as a foreigner. However, it is important to note that all businesses in the USA are required to obtain a business license from the local government. In addition, businesses may also need to obtain a federal tax ID number and register with the state in which they will be operating.

2. What are the most common mistakes foreigners make when starting a business in the USA?

There are a few common mistakes that foreigners make when starting a business in the USA. One is not understanding the different business entity types and choosing the wrong one. Another is not having a clear business plan and not understanding the US market. Additionally, many foreigners underestimate the costs of starting and running a business in the USA, which can lead to financial problems down the road.

3. What type of business entity should I choose for my USA business?

There are several types of business entities in the United States, including sole proprietorships, partnerships, limited liability companies, and corporations. The type of business entity you choose will depend on a number of factors, including the size and scope of your business, the amount of liability protection you need, and the amount of tax liability you are willing to assume.

4. Do I need a visa to start a business in the USA?

There is no specific visa for starting a business in the USA. However, you will need to obtain the appropriate visa for your intended purpose of travel. For example, if you are planning to travel to the USA to start a business, you will need to obtain a business visa.

5. How much money do I need to start a business in the USA?

The amount of money you need to start a business in the USA varies depending on the type of business you want to start. For example, if you want to start a small business, you may only need a few thousand dollars. However, if you want to start a franchise, you may need to invest several hundred thousand dollars.

6. What are the taxation requirements for foreigners starting a business in the USA?

There are a number of tax considerations for foreigners starting a business in the USA. These include federal, state, and local taxes. Federal taxes include income tax, self-employment tax, and payroll tax. State and local taxes can include sales tax, property tax, and business tax. It is advisable to speak with an accountant or tax attorney to determine the specific tax requirements for your business.

7. What are the reporting requirements for foreigners starting a business in the USA?

The reporting requirements for foreigners starting a business in the USA vary depending on the type of business. For example, a sole proprietorship or partnership would not require the same level of reporting as a corporation. However, all businesses are required to file annual federal and state tax returns.

8. What are the compliance requirements for foreigners starting a business in the USA?

The compliance requirements for foreigners starting a business in the USA vary depending on the type of business and the state in which the business is located. However, all businesses must comply with federal, state, and local laws.

9. What are the registration requirements for foreigners starting a business in the USA?

If you are a foreign national and would like to start a business in the USA, you will be required to obtain a visa. There are a few different types of visas that may be available to you, depending on the type of business you plan to start.
If you are starting a business that will involve hiring employees, you will need to obtain an employment-based visa, such as an H-1B visa. If you are starting a business that will not involve hiring employees, you may be eligible for an entrepreneur visa, such as an E-2 visa.
You will also need to register your business with the state in which you plan to operate. Each state has different requirements for business registration.