Guide 44 · Founder personas
The US LLC for agency and consulting founders abroad
An agency sells the founder's judgment, delivered from a laptop, invoiced to clients who increasingly require a US vendor. The US LLC fits this business almost off the shelf — with two edges to respect: services are sourced where they are performed, and the day you put people on the ground in the US, the tax posture changes. The full operating picture for the solo and small-team practice.
On this page
Why clients ask for the entity
US clients — especially companies with procurement departments — onboard vendors through a checklist: a W-9 or its foreign equivalent, an EIN, a certificate of insurance where required, sometimes a certificate of good standing. A foreign individual invoicing from abroad fails the checklist at the first box and gets routed to the slow pile, or to a staffing intermediary who takes a percentage for existing. The US LLC passes the checklist as itself: a domestic vendor with an EIN, a bank account that takes ACH without an international-wire conversation, and a W-8BEN-E that correctly certifies the entity's status.
Sourcing: where the work is performed decides
Services income is sourced by where the services are performed — the rule that quietly governs this entire persona. Work performed at your desk in your home country is foreign-source income to you, even when the client is American and pays in dollars; that is why the standard agency posture is the company-side 5472 with no ECI, as our 1040-NR guide explains. The same rule runs the other way: fly to the client's site in Ohio for a month of delivery and that month's work is US-performed. Founders who travel for delivery should track where workdays happen with the same care as expenses — the fact pattern is built from calendars, not intentions.
Subcontractors, agents and the first US hire
Growth usually arrives as subcontractors before employees, and the distinction matters on two axes. For tax: payments to foreign subcontractors for work performed abroad are generally not US withholding events; payments to US persons trigger information reporting (Form 1099-NEC) and the vendor-collection discipline that goes with it. For ECI: a subcontractor who is a dependent agent habitually concluding contracts in the US can pull the business toward a US trade or business; an independent firm serving many clients generally does not. When the hire becomes a US employee, the company enters payroll — withholding, Form 941, state registrations — a genuine step-change that deserves its own advice engagement, not an assumption that the LLC absorbs it silently.
Paper discipline for a practice
- Contracts in the company's name, with the EIN on every W-9-substitute and vendor form — never the founder's personal details where the company's belong.
- Engagement letters that name the place of performance where it matters — the document and the calendar should agree.
- Draws documented as draws: the founder's pay from a disregarded LLC is an owner transaction, recorded per our bookkeeping guide; calling it salary does not make it wages and confuses every reader.
- Professional-liability cover in the company's name where clients require it — US insurers write these policies for foreign-owned LLCs routinely once the entity and banking exist.
Where the bundle fits a practice
For an agency, the hosted layer is unusually practical: the five-page website is the portfolio US clients check before the first call, the US number is the number on the proposal, and the compliance calendar protects the founder whose attention is sold by the hour from the filing that is not billable to anyone. That is the membership's shape — formation, agent, EIN workflow, website, number and calendar on one bill — priced on our pricing page in the open. The practice itself, its clients and its delivery stay entirely yours, which is rather the point of the entity.
Verification. Checked 2026-11-12 against IRS.gov: services-income sourcing rules, the ECI/trade-or-business framework, and Form 1099-NEC reporting for US payees.
Reading is step one. The paperwork is the rest.
Sethhost handles formation paperwork, the EIN workflow, registered agent service, your website, a US number, and a compliance calendar — one company, one bill. Hosted is $79 per month and formation is included in your first term; the state filing fee is always shown separately.