Form 5472 for foreign-owned US LLCs is one of the most critical compliance requirements under US tax law. Even if the LLC has no income, no expenses, and no tax due, failing to file Form 5472 can result in penalties starting at $25,000.
This guide explains who must file Form 5472, what transactions must be reported, key deadlines, penalties, and practical compliance tips for 2026.
What Is Form 5472?
Form 5472 is an IRS information return used to report certain transactions between a US entity and its foreign owners or related foreign parties.
It is primarily used to:
- Track cross-border transactions
- Prevent tax avoidance
- Ensure transparency in foreign ownership structures
Who Is Required to File Form 5472?
You must file Form 5472 if all of the following apply:
- The entity is a US LLC
- The LLC is 100% or partially owned by a foreign person
- The LLC is treated as a disregarded entity for US tax purposes
- There is any reportable transaction during the year
This applies even if the LLC has no US income.
What Are “Reportable Transactions”?
A reportable transaction includes any financial or non-financial dealing between the US LLC and its foreign owner, such as:
- Capital contribution by foreign owner
- Money transferred to or from the owner
- Reimbursement of expenses
- Management fees
- Loans (given or received)
- Formation or dissolution costs paid by owner
Even a single $1 transaction triggers Form 5472 filing.
Which Tax Form Is Filed Along With Form 5472?
For foreign-owned single-member LLCs:
- Form 5472 is attached to a pro-forma Form 1120
- Only:
-
-
Name & address
-
EIN
-
Ownership details are completed on Form 1120
-
🚫 No income or tax calculation is required on Form 1120.
Filing Deadline for Form 5472 (2026)
| Entity Type | Due Date |
|---|---|
| Calendar Year LLC | April 15, 2026 |
| With Extension | October 15, 2026 |
Extensions are filed using Form 7004.
Penalties for Non-Compliance
The IRS imposes strict penalties for Form 5472 failures:
| Violation | Penalty |
|---|---|
| Failure to file | $25,000 |
| Incomplete or incorrect filing | $25,000 |
| Continued non-compliance | Additional $25,000 |
⚠️ Penalties apply per year, not per return.
Common Mistakes to Avoid
- Assuming “no income = no filing”
- Not reporting owner contributions
- Missing reimbursements paid by owner
- Filing Form 5472 without Form 1120
- Using wrong ownership percentage
- Missing extension filing
Record-Keeping Requirements
Foreign-owned US LLCs must maintain records for at least 6 years, including:
- Bank statements
- Owner transaction details
- Capital contribution proof
- Agreements with foreign owners
These records must be available upon IRS request.
Practical Compliance Tip (CPA Insight)
Many penalties arise not from tax evasion, but from lack of awareness.
Foreign founders often:
- Open US bank accounts
- Transfer funds
- Pay expenses personally
Each of these actions is a reportable transaction under Form 5472.
read more: Cost Segregation Tax Benefits for Rental Properties in 2026
conclusion
Form 5472 compliance is non-negotiable for foreign-owned US LLCs. Even dormant entities must file correctly and on time to avoid heavy penalties.
If you are a non-resident founder, startup owner, or digital entrepreneur, professional guidance ensures:
- Accurate reporting
- Timely filing
- Complete penalty protection
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