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What does a US LLC actually cost an Indian founder in year one?
Plan on $1,000 to $2,500 (roughly Rs 85,000 to Rs 2.2 lakh) for a realistic first year, not the $100 headline you see in ads. The bare government filing is genuinely cheap. Everything that makes the LLC usable from India is not.
Quick Answer: A US LLC for an Indian founder costs about $100 to $300 in state filing fees, plus $50 to $300 for a registered agent, $0 to $300 for EIN help, $0 to $500 for ITIN support and $300 to $1,000 for the annual Form 5472 filing. A lean setup lands near $700 to $1,000 in year one. A Stripe-ready setup with a CPA lands near $1,200 to $1,800.
Three buckets keep this honest. Government fees are unavoidable and fixed by statute. Provider fees are shoppable, and you can do most of the work yourself. Recurring compliance costs come back every year whether you earn a rupee or not.
Every INR figure below uses Rs 85 to Rs 88 per USD, a planning band for 2026, not a live quote. Check the rate on the day you pay. A 5% rupee move shifts a Rs 1.5 lakh budget by Rs 7,500.
The cheapest formation is not the cheapest company. A state that charges nothing to file but bills a large annual report costs more by year three than one that charges $100 upfront. You will meet that trade-off again in the state table below.
If you have not picked a state yet, start with US LLC formation for non-residents before you compare prices, because the state choice sets your recurring bill.
Which state fees are unavoidable, and which states are cheapest for Indian founders?
The state filing fee is the only truly mandatory formation cost, and it runs from about $50 to $500 depending on the state. Wyoming and Delaware are the two most common picks for foreign-owned LLCs, for different reasons.
| State | Formation fee (USD) | Approx. INR | Annual report / franchise tax | What it means for you |
|---|---|---|---|---|
| Wyoming | About $100 | Rs 8,500 to 8,800 | About $60 minimum | Low recurring cost, strong privacy, popular with solo founders |
| Delaware | About $110 | Rs 9,400 to 9,700 | About $300 franchise tax | Higher yearly bill, chosen when you plan to raise venture money |
| New Mexico | About $50 | Rs 4,300 to 4,400 | No annual report | Cheapest to start, thinner support ecosystem |
| Florida | Check the current official fee | Varies | Annual report required | Useful if you have a real US presence there |
| Colorado | Check the current official fee | Varies | Annual report required | Middle ground on cost |
Verify every number in that table against the state Secretary of State fee schedule before you file. Fees change, and a stale blog post is a bad reason to overpay.
Delaware costs more every year, and that is the point. Investors and their lawyers expect a Delaware entity, so you pay the franchise tax for familiarity. Wyoming suits a solo Indian founder selling software or services: low annual cost, no state income tax, and a filing system that works entirely online.
A registered agent is the person or company with a physical US street address who accepts legal mail for your LLC. Every state requires one. It is a separate line item, roughly $50 to $300 a year, and it is not part of the state fee. Do not use a friend's apartment address. You lose privacy, and you lose mail when they move.
Do Indian founders pay for an EIN, and when do you also need an ITIN?
The EIN is free from the IRS. The ITIN is also free from the IRS. What you pay for is convenience, error-checking and passport handling.
An EIN (Employer Identification Number) is your LLC's federal tax ID, the number banks and Stripe ask for first. You get it by filing Form SS-4 by fax or phone as an international applicant. The IRS charges nothing.
Most Indian founders still pay a provider $50 to $300. The fax line is slow, the form has a dozen fields that are easy to fill wrong as a non-resident, and a rejected SS-4 means starting over. That fee buys speed and a second pair of eyes, not the number.
An ITIN is different. It is a personal tax ID for you as an individual, issued on Form W-7, and you need it only when you file a US return or claim treaty benefits. It is the single most conflated pair in Indian-founder content. Your LLC's EIN does not give you an ITIN, and an ITIN does not replace the EIN.
To get an ITIN you send Form W-7 with a certified copy of your passport. Certification comes from the issuing agency or a Certified Acceptance Agent (CAA). CAAs charge roughly $200 to $500 for the service. IRS processing runs about 7 to 11 weeks, longer in peak season.
| Item | IRS fee | Typical provider fee | INR equivalent of provider fee |
|---|---|---|---|
| EIN (Form SS-4) | $0 | $50 to $300 | Rs 4,300 to 26,400 |
| ITIN (Form W-7 via CAA) | $0 | $200 to $500 | Rs 17,000 to 44,000 |
Skip the ITIN in month one. Most fintech banks and Stripe accept the LLC's EIN plus your passport. Buy the ITIN when tax season arrives, and put that money into banking and compliance instead. If you want the paperwork handled, getting an EIN as a non-US resident covers the SS-4 route end to end.
What does US business banking and Stripe setup really cost from India?
Opening a US business bank account usually costs $0 upfront. Running it does not. Monthly maintenance runs $0 to $25, minimum balances run $0 to $2,000, and international wires cost roughly $15 to $45 each way.
Stripe charges no setup fee. It takes a cut of each transaction, around 2.9% plus $0.30 on a US account. On $5,000 of monthly revenue that is real money, and it belongs in your budget as a percentage, not a one-time cost.
| Option | Setup cost | Monthly fee | Minimum balance | Notes for Indian-resident owners |
|---|---|---|---|---|
| Mercury | $0 | $0 | $0 | Fintech account, online application, popular with startups |
| Wise Business | $0 | $0 | $0 | Strong multi-currency and INR transfer routes |
| Payoneer | $0 | $0 | $0 | Works well for marketplace payouts |
| Brex | $0 | Check current plan terms | Check current plan terms | Oriented toward funded startups |
| Traditional US bank | $0 to $100 | $10 to $25 | $1,500 to $2,000 | Usually needs a US visit or a strong referral |
Those cells are starting points, not quotes. Provider fee schedules change, and eligibility rules for Indian-resident owners change faster. Read the provider's own pricing page on the day you apply.
Say your Stripe application gets declined in week three. You have already told clients you accept cards. The fix is a second processor, a clean business description and a US address that matches your filings, and it costs you two to four weeks of selling time. Budget for a fallback before you need one.
Approval is never guaranteed. No bank and no processor owes you an account. A US LLC with an EIN makes you eligible to apply. The decision stays with the provider.
Getting money home is its own line. Wire fees, the FX spread and your Indian bank's inward remittance charges add up on every transfer. If you invoice US clients from an Indian entity instead, GST on export of services and FEMA reporting rules apply, and your CA will charge for that work.
Which fees come back every year, whether or not you earn anything?
Registered agent, state annual report, a US address and the federal Form 5472 filing. Miss the last one and the penalty is $25,000.
| Recurring item | Frequency | USD | Approx. INR | Unavoidable? |
|---|---|---|---|---|
| Registered agent | Annual | $50 to $300 | Rs 4,300 to 26,400 | Yes |
| State annual report / franchise tax | Annual | $0 to $300+ | Rs 0 to 26,400+ | Yes |
| US address and mail forwarding | Annual | $100 to $300 | Rs 8,500 to 26,400 | Practically yes |
| Form 5472 + pro forma Form 1120 | Annual | $300 to $1,000 (CPA) | Rs 26,400 to 88,000 | Yes, filing itself |
| Bookkeeping | Monthly or annual | Varies | Varies | Optional, wise |
A foreign-owned single-member LLC files Form 5472 with a pro forma Form 1120 every year. It is an information return, not a tax payment. The LLC discloses its reportable transactions with the foreign owner. File nothing and the IRS can assess $25,000 per form per year, with more for continued failure. That applies even if the LLC earned zero.
On income: a single-member LLC owned by a non-resident with no US-source effectively connected income owes no US federal income tax. That is not the same as owing nothing anywhere. State-level taxes, sales-tax nexus and your Indian tax position under DTAA rules all depend on your facts. Talk to a cross-border CPA before you assume anything.
Suppose your LLC takes $40,000 in year one and you skip the 5472 because the money came from clients outside the US. The penalty exposure is $25,000 against a $300 to $1,000 CPA bill. Do the math once and the DIY temptation disappears.
What hidden costs do Indian founders only discover after forming the LLC?
The surprises are mail forwarding, a US phone number, sales-tax registration, bookkeeping, and the India-side CA bill for ODI, FEMA and GST work.
- Mail forwarding and a US number: $100 to $300 a year. Verification codes and bank letters arrive by post and phone.
- State sales-tax registration: required once you cross a state's economic nexus threshold. Compliance software or a preparer costs money per state.
- Bookkeeping: $50 to $200 a month if you outsource it. Cheaper than fixing a year of mess in April.
- India-side CA work: FEMA and ODI reporting for outbound investment, GST filings on export of services, and DTAA documentation. Ask your CA for a quote in rupees before you form anything.
- TDS on cross-border payments: if you pay US contractors or services, withholding rules apply and someone has to track them.
- Fixing a rejected application: two to four weeks of lost selling time, plus any re-application fees.
Imagine you form the LLC, land three US clients, and only in month eight learn that your Indian CA wants extra for ODI reporting on the outbound investment. That is a real rupee cost you did not budget. Ask the question before you file, not after.
What is a realistic total first-year budget for an Indian founder?
Three scenarios, same line items, so you can swap in your own state and provider.
| Line item | Lean solo | Stripe-ready | Fully managed |
|---|---|---|---|
| State filing fee | $100 | $100 | $110 |
| Registered agent (year 1) | $50 | $150 | $300 |
| EIN | $0 (self-filed) | $150 | $300 |
| ITIN | $0 (deferred) | $0 (deferred) | $400 |
| US address / mail | $0 | $100 | $200 |
| Banking | $0 | $0 | $25/month |
| Form 5472 + 1120 (CPA) | $0 (DIY) | $400 | $800 |
| Bookkeeping | $0 | $600 | $1,200 |
| Year-one total (USD) | $150 to $300 | $1,500 to $1,800 | $3,300 to $3,600 |
| Year-one total (INR) | Rs 13,000 to 26,000 | Rs 1.3 to 1.6 lakh | Rs 2.8 to 3.2 lakh |
| Year-two total (USD) | $60 to $150 | $1,250 to $1,550 | $2,900 to $3,200 |
Year two drops the state filing fee and the ITIN. Everything else recurs. That is why the lean column looks so attractive and why the Stripe-ready column is the one most founders actually need.
A decision rule that saves people money: if your expected annual profit from the LLC is under about $5,000, the compliance overhead eats a large share of it. Sell as an Indian proprietorship first, prove demand, then form the US LLC when the revenue justifies the fixed cost.
Be blunt with yourself about which column you are in. Do not buy the fully managed package to feel safe. Buy the Stripe-ready column, self-file the EIN if you are comfortable with Form SS-4, and spend the savings on a CPA who knows Form 5472.
Common Mistakes
Paying twice for an EIN. The IRS issues it free. A rejected SS-4 means paying the provider again, so check every field against your formation documents before you fax.
Buying the ITIN in month one. You need the EIN to open banking. You need the ITIN at tax time. Sequencing them wrong ties up Rs 17,000 to Rs 44,000 for months.
Choosing a state on filing fee alone. A cheap filing with an expensive annual report costs more by year three. Model the recurring number, not the first cheque.
Skipping Form 5472 because the LLC made no money. The $25,000 penalty does not care about your profit. It cares that the form is missing.
Assuming Stripe or Mercury will approve you. Budget for a fallback processor and a second bank application. Approval is the provider's call, always.
Forgetting the India side entirely. ODI and FEMA reporting, GST on export of services and DTAA paperwork are real costs. Your CA quotes them in rupees, not dollars.
Using a friend's US address as the registered agent address. You lose privacy and you lose mail the day they move. Pay the $50 to $300.
Frequently Asked Questions
Can I form a US LLC from India for under $500?
Yes. A Wyoming or New Mexico LLC with a self-filed EIN and no banking extras lands near $150 to $300 in government and agent fees. The $500 ceiling breaks once you add a paid EIN service, mail forwarding or an ITIN.
Do I need an ITIN to open a US business bank account?
Usually no. Most fintech banks and Stripe accept the LLC's EIN plus your passport. The ITIN matters at tax-filing time or when you claim treaty benefits.
Is the EIN free for Indian citizens?
Yes. The IRS issues EINs at no charge on Form SS-4 by fax or phone. Paid services charge for convenience and error-checking, not the number.
What happens if I do not file Form 5472 for my foreign-owned LLC?
The IRS can assess a $25,000 penalty per form per year, plus more for continued failure. It applies even when the LLC had no income.
How much should I budget in rupees for the first year?
Roughly Rs 13,000 to Rs 26,000 for a lean setup and Rs 1.3 to 1.6 lakh for a Stripe-ready one at Rs 85 to Rs 88 per USD. Managed setups with ITIN and a CPA reach Rs 2.8 to 3.2 lakh. Re-check the live rate before you commit.
Do I have to pay US tax on my LLC's profits as an Indian resident?
A single-member LLC owned by a non-resident with no US-source effectively connected income owes no US federal income tax. Form 5472 is still required, and your Indian tax position under DTAA rules still applies. Confirm with a cross-border CPA.
Next step
The number that matters is not the $100 filing fee. It is the recurring annual bill, and you can price it today: pick your state, add the agent, the address and the 5472 filing, and see whether your expected revenue clears it. If it does, form the LLC and stop deliberating. If it does not, wait a year and keep selling.
When you are ready to move, NexFyla helps non-US founders form US companies and set up EIN and US business banking support, so the paperwork does not eat your first month of selling. You can also compare NexFyla pricing against the budget above before you decide.
*Last updated: February 2026.*
Ready to act on this? US company formation takes the filing, registered agent and paperwork off your desk.