STARTING A BUSINESS IN THE USA: A GUIDE FOR FRENCH-SPEAKING ENTREPRENEURS 

STARTING A BUSINESS IN THE USA: A GUIDE FOR FRENCH-SPEAKING ENTREPRENEURS 

The idea of starting a business in the United States, even if you're not American, may seem daunting at first. However, it's important to know that the so-called American Dream isn't just for citizens of the country! In fact, neither citizenship nor residency are required to start a business in the United States.

Investir.US presents a practical guide to the various steps involved in starting a business across the Atlantic. This guide will be of interest to our French-speaking friends, whom our expert offers to assist, starting with a free, no-obligation preliminary interview .

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Steps to follow for a French speaker wishing to start a business in the USA

You're not a U.S. citizen. Are you a French speaker looking to start a business in the U.S.? Here are 7 key steps you'll need to take to achieve your goals:

Obtain the necessary federal authorizations

Generally, foreign entrepreneurs do not need a green card to start or own a business in the United States, or even to be listed as a corporate officer or director of a U.S. company. The only requirement, of course, is that they pay taxes.

On the other hand, to work for a company in which you have invested, you will need to obtain approval from the US government through an E-2 investor visa or an EB-5 visa.

Obtaining an E-2 Investor Visa

To obtain an E-2 investor visa, a French-speaking (or other) non-immigrant, non-U.S. citizen investor must:

Be a national of a country with which the United States has a treaty of commerce and navigation;

Present yourself as an active investor (or have already invested) with a substantial amount of capital in a bona fide US company;

Be (or seek to be) in the United States for the sole purpose of developing and conducting the investment business.

The E-2 investor visa allows nonimmigrant investors to make an initial stay in the United States for up to two years. Extended stays may follow, granted in increments of up to two years. While there is no limit on the number of extensions that may be requested, E-2 investors must demonstrate their intent to depart the United States upon the expiration (or termination) of their E-2 status.

It is also important to know that E-2 investors can only work in the same capacity for which they were approved when they were granted E-2 status. Further information is available on the U.S. Citizenship and Immigration Services ( USCIS ) website.

Obtaining an EB-5 visa

Originally created to promote employment in the United States, the EV-5 visa is available to foreign entrepreneurs who invest at least $1.8 million. This amount is reduced to $900,000 if the entity is located in a targeted employment area and creates 10 new full-time jobs.

Foreign investors who qualify for the EB-5 visa may also qualify for permanent residency in the United States. Some may even be eligible for U.S. citizenship, depending on their financial investment and commitment.

Doing business in the USA: discuss your project with a French-speaking expert

Choose a business entity type

When a foreign investor wishes to form a company in the United States, they face certain restrictions. For example, non-residents cannot form an S Corporation, as each shareholder must be a U.S. citizen or a permanent resident alien. Therefore, French-speaking investors generally choose a C Corporation and Limited Liability Company (LLC) type of business entity. These forms offer personal liability protection for business owners and some tax flexibility.

C corporations are a separate legal and tax entity from the owners of the business (called "shareholders"). Therefore, the owners' personal assets are protected from the legal and financial liabilities of the business. The business reports its profits and losses through a corporate tax return.

LLCs (Limited Liability Companies), on the other hand, are considered legal entities separate from their owners (called "members"). They therefore offer a form of personal liability protection for entrepreneurs.

Foreign investors, like any business owner, must pay income taxes to the U.S. Internal Revenue Service (IRS) and the state. Other federal, state, and local taxes and fees may also apply.

Choosing an authorized agent

LLCs and C corporations must use a registered agent in each state where they have filed registration documents to have their business recognized. This includes legal notices, correspondence from the Secretary of State, and other official government notifications.

While rules vary by state, a registered agent must generally be of legal age, have a physical address in that state, and be available at that address during normal business hours. Some companies provide registered agent services. A list of companies offering registered agents can be obtained from the Secretary of State's office in the state where you incorporated your business.

Obtain an EIN

Every business has a taxpayer identification number (TIN). Corporations and LLCs require an EIN (Employer Identification Number). Note that since 2019, the IRS only allows individuals with an SSN or ITIN to be the "responsible party" for EIN applications. 

Since a foreign entrepreneur does not have a Social Security number, they can apply for an Individual Taxpayer Identification Number (ITIN) instead. The IRS form (W-7) requires documents to confirm the individual's identity (e.g., driver's license, birth certificate) and connection to a foreign country (e.g., passport).

After obtaining an ITIN, an investor can apply for an EIN using Form SS-4.

Open a Business Bank Account in the United States

Establishing a US-based entity requires opening a bank account in the country.

Since the adoption of the USA Patriot Act, opening a bank account in the United States has become possible with official documents and proof of identity, generally requiring the following documents:

Official business documents that show your address in the United States

ITIN and EIN numbers

The passport

Obtain the necessary licenses and permits

As with any business, foreign investors must obtain licenses and permits relevant to their industry, business activities, and the jurisdictions in which they operate.

The requirements your business is subject to can be found with the Secretary of State, the County Clerk, and local authorities.

Depending on the type of entity you want to create or invest in, as well as the location of the business, there may be compliance formalities to complete. Tax returns, annual reports, license and permit renewals, shareholder meetings... It's important, before you start, to be up to date with all the formalities that will ensure your full compliance with the current regulations.