IRS reporting requirements for an international business

[haris_n]

Seeking clarity on the IRS reporting requirements for an international business/LLC with no presence in the US and no ties/connections to any US firms. The LLC will be made up of both US and non-US partners with equal ownership. The business will generate income through rentals/leasing and occasional sales of properties, all done internationally, no connections to US. At this point no distributions are foreseen to be received by any of the partners from the business. All income generated by the business will be retained within the business or reinvested into the business. Questions:

1. Do US partners need to declare the business ownership to the IRS if so which forms should be filed?  Is this dependent on capital is committed to the business by the US partners?

Thanks in-advance.

[pk]

@haris_n , not knowing which country you are talking about (-- so no treaty considerations ---),  your investment entity may be classed as a  Passive Foreign  Investment Company  --PFIC.  This is generally covered by section 1297 and follow-on sections of the IRS code.   There is specific  reporting and taxing requirements  based on percentage ownership .  There may also be Mark-to-Market  taxing requirements.   I am providing here a link to the code section  below. Please familiarize yourself with the requirements.    Also  please consider engaging a tax professional familiar  with international taxation --- this is complex.

26 U.S. Code § 1297 - Passive foreign investment company | U.S. Code | US Law | LII / Legal Informat...

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