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As a single member LLC owned by a foreign person, which has not made an election to be treated as a C corporation, the LLC is automatically classified as a disregarded entity. This means, the LLC does not pay income taxes unless the business is generating income that is effectively connected to a US trade or business or income is FDAP (Fixed, Determinable, Annual, or Periodical). FDAP income is all income except gains from the sale of real estate or other personal property. Income excluded i.e. tax-exempt municipal bonds interest and qualified scholarships.
As a foreign person, generally you will not be subject to taxation if you provide personal services, i.e. marketing, IT consultancy, web development, teaching online, or other personal tech support; however, if you sale products to US markets, you will have additional tax obligations other than informational forms 1120 and 5472. You must file the necessary tax forms on a timely manner to be compliant and not be at risk of paying major fines. The fines start at $10,000 but can go to $25,000 for a single LLC.
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