Form 5472: $25,000 Penalty for Non-Resident LLCs (Filing Guide)
Every foreign-owned US LLC files Form 5472. Miss it: $25,000 per form per year. Deadlines, filing steps, and 7 providers' prices ($300-$1,999).
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The penalty for missing Form 5472 is $25,000 per form, per year. Every foreign-owned single-member LLC files Form 5472 annually with the IRS, attached to a pro forma Form 1120. Due April 15, extendable to October 15. Revenue and profit are irrelevant — if your LLC existed and any money moved between you and the entity, the filing obligation was triggered. Published prices for filing it start at $300; bundles that add other services run to $1,999 a year.
October 2026 update: the cost table now lists published prices from seven providers, re-read on 2026-10-02. It also corrects an error we introduced in July: Firstbase's package for a single-member LLC owned by a non-US person is $899 a year. The $1,799 we showed from 2026-07-15 is its price for C-Corps and multi-member LLCs.
Deadlines as of October 2026: if you filed Form 7004 by April 15, 2026, your tax-year 2025 return is due October 15, 2026. If you didn't file the extension, that return is already late, and the section on reducing the penalty is the one to read next. Tax-year 2026 returns are due April 15, 2027. For a zero-revenue single-member LLC, filing it yourself works too: the DIY tax filing guide walks through it and says where DIY stops making sense.
I didn't know about Form 5472 until a founder in my network got hit with the penalty. He'd done everything right -- formed his LLC, got the EIN, opened a Mercury account, started invoicing clients. Nobody mentioned Form 5472. Eighteen months later, a $25,000 notice showed up.
What is Form 5472?
Form 5472 is an IRS information return. The full title mentions "25% Foreign-Owned U.S. Corporation" -- which sounds like it wouldn't apply to your single-member LLC. It does. The IRS treats foreign-owned single-member LLCs as corporations for this specific reporting purpose under Treasury Regulation 1.6038A-1(c)(1).
The form captures any money that moved between you and your LLC:
- Capital contributions — money you put in
- Distributions — money you took out
- Loans — borrowed or lent between you and the LLC
- Rent or lease payments — the LLC using your personal assets or the reverse
- Service payments — you paying the LLC, or it paying you
- Any other monetary transaction between the LLC and a 25%+ foreign owner
If you wired $500 to fund the LLC's bank account, that was a reportable transaction. The filing obligation started that day.
Who has to file Form 5472?
You file Form 5472 if your US LLC checks three boxes:
- Single-member (or treated as a disregarded entity)
- Owned by a foreign person -- not a US citizen, no green card, doesn't meet the substantial presence test
- Had at least one reportable transaction during the tax year
That third one trips people up. You don't need revenue. A single capital contribution counts.
The form gets attached to a pro forma Form 1120 (US Corporation Income Tax Return). The 1120 itself is all zeros -- no income, no tax. It exists only as the vehicle to carry Form 5472. Both forms go in together as one submission.
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When is Form 5472 due?
April 15 following the calendar year. Form 5472 for 2025 is due April 15, 2026.
You can extend six months to October 15 by filing Form 7004 before the April deadline. Technically this extends the time to file, not to pay -- but since most foreign-owned single-member LLCs owe zero US tax, the distinction is academic.
Here is the part that catches people: the filing obligation starts the year you formed the LLC. Not the year you earned revenue. I know a founder who incorporated in September, had zero clients by December, and still owed a Form 5472 for that year because he'd wired $500 into the business account.
The $25,000 penalty: how it works
IRC Section 6038A(d) prescribes $25,000 for:
- Failure to file -- you never submitted it
- Late filing -- submitted after the deadline, extension included
- Substantially incomplete filing -- submitted but missing material information
Per form, per year. One LLC, two missed years = $50,000. Two LLCs, one missed year each = also $50,000.
It gets worse. After the initial $25,000, the IRS sends a notice demanding compliance. If you still haven't filed 90 days later, an additional $25,000 accrues every 30 days. No cap.
Penalty timeline example
| Event | Penalty exposure |
|---|---|
| LLC formed in 2024, no Form 5472 filed for 2024 | $25,000 |
| 2025 passes, no Form 5472 filed for 2025 either | $50,000 cumulative |
| IRS notice received in 2026, 90-day clock starts | $50,000 + accruing |
| 120 days after notice, still not filed | $50,000 + $25,000 additional = $75,000 |
These are statutory penalties. The IRS has the authority to assess them without proving intent or harm.
Track the dates that carry penalties
Form 5472 is due with your pro-forma 1120 on the same date every year. Get that date by email — 30 days, 7 days, and 1 day before, each linked to its statutory source.
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What triggers IRS awareness?
Multiple channels, and the IRS is getting better at connecting them.
EIN records. When you applied for an EIN, the IRS recorded that the responsible party is a foreign person. They cross-reference that against filed returns. A foreign-owned EIN with no Form 1120 + Form 5472 on file is a straightforward data match. (The EIN vs. ITIN distinction matters here -- the EIN creates the entity-level obligation.)
Bank account reporting. US banks report account holder information to the IRS. An LLC bank account with a foreign owner that shows no corresponding tax filing is a flag.
FATCA and CRS. Under CRS and FATCA, financial institutions in participating countries share account data with tax authorities. If you have bank accounts internationally and no US filing, that gap is visible across borders.
State formation records. Stripe Atlas, Firstbase, Doola -- all of them file formation documents with state secretaries of state. Those records are accessible to the IRS.
None of this is instant. But the automation has improved sharply over the past few years. The gap between "I formed my LLC" and "the IRS noticed I didn't file" is shrinking. The documentation gap analysis shows what authorities actually see when they pull up a founder's records.
Can the penalty be reduced or removed?
Yes, but nothing is guaranteed.
Reasonable cause. You need to show the failure wasn't willful neglect. Relying on a tax professional who failed to mention Form 5472 is a stronger argument than "I didn't know." But even "I didn't know" isn't automatically disqualifying -- the IRS looks at the totality of circumstances.
First-time penalty abatement. This program exists for common penalties (failure-to-file, failure-to-pay under IRC 6651). Form 5472 penalties fall under IRC 6038A, so the first-time abatement doesn't automatically apply. Some practitioners have gotten abatement through reasonable cause arguments, but it's case-by-case.
Streamlined filing. For US persons living abroad who were non-willful, the Streamlined Filing Compliance Procedures offer a path to compliance with reduced penalties. This covers delinquent tax returns and information returns, including Form 5472.
Bottom line: filing late is always cheaper than not filing at all.
Already several years late: the voluntary compliance path
The single most misread part of Form 5472 is what happens when the gap is not one year but several. Each unfiled year is its own separate obligation, so the exposure stacks rather than merging into one number.
A foreign-owned single-member LLC that formed in 2022 and never filed owes a separate pro forma Form 1120 with Form 5472 attached for 2022, 2023, 2024, and 2025 — four returns, each carrying its own $25,000 figure under IRC §6038A. Three years unfiled is a $75,000 face figure before any reasonable-cause argument is even raised. The penalty does not compound into a single sum; it repeats per form, per year.
The path back is mechanical, not mysterious:
- Reconstruct the reportable transactions for each open year — the initial capitalization wire, owner draws, money you moved back to yourself, loans in either direction, expenses you paid personally on the LLC's behalf. What your CPA needs to see covers what that reconstruction actually looks like.
- Prepare a pro forma Form 1120 + Form 5472 for each delinquent year. The forms are year-specific; a 2022 transaction goes on a 2022 return.
- Attach a written reasonable-cause statement — one per return, or a single combined statement that references every year.
- File the package by mail or fax to the address in the Form 5472 instructions. A foreign-owned disregarded entity files this separately from any individual return the owner may have.
One point that trips up founders searching for an amnesty program: the IRS discontinued its standalone Delinquent International Information Return Submission Procedures in November 2020. There is no longer a named program specifically for late information returns. What remains is the reasonable-cause standard under Treas. Reg. §1.6038A-4 — you file the delinquent forms and attach a statement showing the failure was due to reasonable cause and not willful neglect. Reliance on a formation service or a preparer who never surfaced the requirement carries more weight than unawareness alone.
A scoping caveat that gets missed: the Streamlined Filing Compliance Procedures mentioned above are for US persons — citizens and green-card holders living abroad. A non-US-person who owns the LLC sits outside that program, so the reasonable-cause delinquent filing described here is the path, not Streamlined. Conflating the two is a common source of wasted effort.
The gap between discovering the obligation and acting on it is itself part of the record. A founder who files within weeks of learning of the requirement presents a different picture than one who sits on it for another two years.
How much does it cost to file Form 5472?
I re-read every price below on its provider's own page on 2026-10-02. O&G's published rate is also what I paid for my own LLC's return. The same two forms cost anywhere from $300 to $1,999 a year, depending on who files them and what else comes in the package.
| Provider | Published price | What the price covers | Who signs |
|---|---|---|---|
| 1040 Abroad | $300 per LLC, per tax year | Form 5472 + pro forma 1120, faxed to the IRS for you. Zero-revenue LLCs covered; reasonable-cause statement for late filings when needed | Not named on the page |
| O&G Tax and Accounting | $500 one-time (published rate); also my invoice for the 2025 tax year | Form 5472 + pro forma 1120 for my Delaware LLC, faxed to the IRS by the firm | Alex Oware, CPA, Esq. |
| Form5472.online | $399 prepared and signed; $448 with IRS fax submission and written confirmation; $547 for an LLC "with reportable activity" | Form 5472 + pro forma 1120 | "A U.S.-Licensed & Verified CPA", supervised by Arik Rozen, CPA, Virginia licence 25991 (NASBA's CPAverify lists it active, under the name Arie Rozen, on 2026-10-02) |
| Bookmate | "Starting at $400" for Form 1040-NR or 5472 | Lists 5472 and 1120 among the forms it files; final price by quote | Not named ("CPA support") |
| Greenback | $405 for "a US LLC with Foreign Owners" | Form 5472. The page does not say whether the pro forma 1120 or the IRS submission is included, and it is written for US expats | Not named; the site says every accountant is a CPA or EA |
| Firstbase | $899/yr | Form 5472, pro forma 1120, the 6-month extension and 1099s, for a single-member LLC owned by a non-US person. Its $1,799/yr package is for C-Corps and multi-member LLCs | Not named |
| Doola | $1,500/yr standalone, or $750 for a company with zero revenue and no activity (help center); $1,999/yr in the Tax and Compliance bundle | Federal and, where applicable, state returns. The bundle adds everything in doola's Starter plan and a tax consultation | Not named ("in-house CPA and tax team") |
| A general CPA practice | Quote-based | Reader-reported quotes in r/tax and r/smallbusiness threads ran $650 to $1,200 in April 2026 | Your CPA |
| Yourself | $0 | Merge the two forms into one PDF and fax or mail it. The DIY walkthrough covers the steps | You |
My read, for a single-member LLC whose only transactions were money moving between you and the entity: 1040 Abroad's $300 is the cheapest complete package published anywhere I looked, and it includes the fax to the IRS. Form5472.online costs more, and it is the only provider here that names the CPA in charge of its returns, with a licence number you can look up on CPAverify in about a minute. If a licence you can check matters to you, that difference is what you are paying for. The page says returns are signed by a licensed CPA under his supervision, so ask whose name and PTIN will be on yours. Before paying, ask which of its tiers your LLC falls into. An LLC that moved any money between owner and entity during the year has reportable transactions in the Form 5472 sense, and that may put you on the $547 tier rather than the $448 one.
Firstbase's $899 makes more sense if you are already its customer, or want the extension and 1099s handled in the same place. Doola's $1,999 buys a bundle, so it is not a like-for-like filing price; its standalone $750 zero-activity rate is the closer comparison, and it is still more than double the specialists' published prices. One flag on Bookmate: its page says returns are "securely e-filed", but the Form 5472 instructions say a foreign-owned disregarded entity cannot file Form 5472 electronically. Ask how it actually submits yours.
Disclosure: Firstbase and doola pay Global Solo a commission when a reader signs up through our links. None of the other providers in this table pay us anything. O&G's Alex Oware is also the tax professional I have introduced readers to; no referral fee is involved. O&G is the only provider here I have used myself.
$300 to $547 a year, against a $25,000 penalty per form. The math isn't close.
When I set up compliance for my own LLC, the hardest part was getting the right documents to my CPA. Most founders don't have clean records of what moved between them and the LLC. What your CPA needs to see covers the specifics.
Multi-member LLCs: a different filing obligation entirely
Everything above applies to single-member foreign-owned LLCs. If the LLC has two or more members, the tax classification changes from disregarded entity to partnership. The filing obligation shifts from Form 5472 + pro forma 1120 to Form 1065 (US Return of Partnership Income), with individual Schedule K-1s for each member.
Form 1065 is a more complex return with a different deadline — March 15, not April 15. The penalty for late filing is $220 per partner per month (up to 12 months), and the return itself requires allocation of income, deductions, and credits across members. Tax practitioners identify this as a common structural mistake: non-resident founders adding a co-founder or investor to their LLC without realizing it triggers an entirely different (and more expensive) compliance regime.
What this means for new LLC owners
If you formed a US LLC as a non-resident and haven't filed Form 5472, the obligation already exists. It doesn't start when you earn revenue or take a distribution. It started the day you funded the bank account.
The penalty is the same whether you moved $500 or $500,000. That asymmetry is what makes Form 5472 dangerous -- it punishes the smallest, simplest LLCs just as hard as complex corporate structures. And the founders running those small LLCs are the ones least likely to know about it.
The risk check flags whether your LLC structure has a Form 5472 gap, along with other compliance obligations tied to your specific cross-border setup.
Key Takeaways
- The IRS penalty for a missing or late Form 5472 is $25,000 per form, per year. A founder who misses two years faces $50,000+ in accumulated penalties before any other consequence.
- Every foreign-owned single-member LLC files Form 5472 annually with a pro forma Form 1120, regardless of whether the LLC had revenue. The obligation starts from the year of formation.
- Published prices for filing run from $300 (1040 Abroad, fax submission included) to $547 (Form5472.online, CPA-signed and submitted, for an LLC with reportable activity). Firstbase charges $899/yr for a single-member LLC owned by a non-US person; doola charges $1,500/yr standalone ($750 with zero revenue and no activity) or $1,999/yr in its Tax and Compliance bundle. None of the major formation services include it in their base formation price.
- Penalty abatement is possible through reasonable cause or streamlined filing, but it is discretionary. Filing late is always less expensive than not filing at all.
- When several years are unfiled, each year is a separate return carrying its own $25,000 figure — the exposure stacks rather than merging into one. The reasonable-cause delinquent-filing path under Treas. Reg. §1.6038A-4 is how non-resident owners come back into compliance; the IRS retired its standalone delinquent-information-return program in November 2020.
Frequently Asked Questions
Do I need to file Form 5472 if my LLC had no income?
Yes. The trigger is "reportable transactions," not income. If you put money into the LLC -- even $100 as a capital contribution -- that counts. Paying the LLC's expenses from personal funds counts. Any monetary transfer between you and the LLC counts. Zero revenue is irrelevant.
How do I file Form 5472 for my non-resident LLC?
Attach it to a pro forma Form 1120 (all zeros for income and tax -- the 1120 is just the filing vehicle) and write "Foreign-owned U.S. DE" across the top of the 1120. A foreign-owned disregarded entity cannot file Form 5472 electronically: the Form 5472 instructions send it by fax to 855-887-7737 or by mail to the IRS PIN Unit in Ogden, Utah, not to the addresses in the Form 1120 instructions. You can file it yourself or pay a filer; published prices start at $300, and the cost table above lists seven providers and what each one covers. The expat tax service comparison goes deeper on the expat-focused firms.
Can I file Form 5472 late to avoid the full penalty?
Late is better than never. The IRS assesses the $25,000 when they discover non-filing, but a late filing with a reasonable cause explanation can lead to abatement -- at their discretion. Once they send a formal notice, you get a 90-day window before additional penalties start stacking. Filing within that window stops the escalation, even if you're late relative to the original deadline.
Does Stripe Atlas or Firstbase file Form 5472 for me?
Stripe Atlas does not -- at any price point. You're on your own. Firstbase sells a separate tax package: $899/yr for a single-member LLC owned by a non-US person, covering Form 5472, the pro forma 1120 and the extension ($1,799/yr is its C-Corp and multi-member package). Doola includes federal tax filing in its Tax and Compliance tier at $1,999/yr, and its help center prices the IRS filing on its own at $1,500/yr, or $750 for a company with zero revenue and no activity. None of the three include Form 5472 in the base formation price.
Related Reading
- How Much Does It Cost to Form and Maintain a US LLC?
- Stripe Atlas vs Firstbase vs Doola: Pricing Comparison 2026
- Cross-Border Compliance Checklist 2026
- FBAR for Digital Nomads: The $10K Threshold Trap
- How to Form a US LLC as a Non-Resident (2026)
References
- IRS: Form 5472 — Information Return of a 25% Foreign-Owned US Corporation
- IRS: Form 1120 — US Corporation Income Tax Return
- IRS: Form 7004 — Application for Automatic Extension of Time to File
- IRS: Instructions for Form 5472 — fax and mail filing for a foreign-owned US disregarded entity; no electronic filing
- IRC Section 6038A — Information with Respect to Certain Foreign-Owned Corporations
- Treasury Regulation 1.6038A-1 — General requirements and definitions
- IRS: Streamlined Filing Compliance Procedures — Voluntary compliance for non-willful failures
- Stripe Atlas — Formation service
- Firstbase — Formation and compliance service
- Doola: pricing and IRS tax filing service pricing — $1,999/yr bundle; $1,500/yr standalone, $750 with zero revenue and no activity (read 2026-10-02)
- Firstbase: pricing — $899/yr package for a non-US-owned single-member LLC; $1,799/yr for C-Corps and multi-member LLCs (read 2026-10-02)
- 1040 Abroad: Form 5472 — $300 per LLC per tax year, fax filing included (read 2026-10-02)
- Form5472.online — $399 / $448 with IRS submission / $547 with reportable activity (read 2026-10-02)
- O&G Tax and Accounting: service packages — $500 one-time for a foreign-owned single-member LLC's pro forma 1120 and 5472 (read 2026-10-02)
- Bookmate: tax filing — "Starting at $400" for Form 1040-NR or 5472 (read 2026-10-02)
- Greenback: additional services — $405 for Form 5472 for a US LLC with foreign owners (read 2026-10-02)
- NASBA CPAverify — public CPA licence lookup
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Disclosure
*Mercury is a fintech company, not an FDIC-insured bank. Banking services provided through Choice Financial Group and Column N.A., Members FDIC.
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