My LLC made no money. Do I still have to file?

Yes. Form 5472 reports transactions between the company and its foreign owner, and the obligation arises from the ownership structure rather than from trading. Forming the company and contributing capital are themselves reportable transactions, so even a company that never invoiced anyone has something to report.

What counts as a reportable transaction?

Money or property moving between the company and its foreign owner or related parties — capital contributions, distributions, loans in either direction, payments for services, rent, royalties and interest. Formation costs paid personally by the owner also count.

Is Form 5472 a tax return?

No, it is an information return. It does not calculate tax and filing it does not create a tax liability. That is precisely why it gets missed: founders with no US tax to pay assume there is nothing to file.

I have not filed for several years. What now?

The exposure is per year, so it compounds. Speak to a US tax practitioner about the options, which may include reasonable-cause relief depending on your circumstances. Doing nothing is the one approach that reliably makes it worse.

Building a US business from outside the United States

Guide · 3 min read

Form 5472: the filing foreign-owned LLCs miss, and the $25,000 penalty

The most expensive gap in this category. It applies to companies that earned nothing, and the penalty is larger than most founders' first year of revenue.

The short answer

A US LLC with a single foreign owner must file Form 5472 with a pro forma Form 1120 every year, reporting transactions between the company and its owner. It is due whether or not the company earned anything, and the penalty for failing to file starts at $25,000 per year.

Who has to file

A US LLC that is treated as a disregarded entity and is wholly owned, directly or indirectly, by a foreign person. In practice: a single-member LLC whose member is not a US person. It applies equally to foreign-owned US corporations.

Note what does not matter: whether you made money, whether you owe US tax, whether the company ever had a bank account, or whether you have visited the United States.

What actually gets reported

Transactions between the company and its foreign owner or related parties. The category is broader than founders expect.

Capital you contributed to the company.
Distributions you took out.
Loans in either direction, and any interest.
Payments for services, rent or royalties between you and the company.
Formation costs you paid personally — which is why a company that never traded still has a reportable transaction in its first year.

How it is filed

Form 5472 is attached to a pro forma Form 1120. The 1120 is not reporting corporate income — the LLC is not a corporation and is not paying corporate tax. It is acting purely as an envelope, with only identifying information completed, so that the 5472 has something to attach to.

The dormant-company trap

The most common version of this problem: someone forms an LLC intending to start a business, never gets going, and forgets about it. The entity continues to exist, so the filing obligation continues, and the penalty accrues annually until the company is formally dissolved.

If you have an idle LLC, the cheapest path is usually to bring the filings current and then dissolve it properly rather than leaving it to lapse.

Federal tax filing

Form 5472 and the pro forma 1120 prepared and filed for foreign-owned LLCs, with the deadline tracked so a quiet year doesn't become a penalty notice.

See what's included

Frequently asked questions

My LLC made no money. Do I still have to file?: Yes. Form 5472 reports transactions between the company and its foreign owner, and the obligation arises from the ownership structure rather than from trading. Forming the company and contributing capital are themselves reportable transactions, so even a company that never invoiced anyone has something to report.
What counts as a reportable transaction?: Money or property moving between the company and its foreign owner or related parties — capital contributions, distributions, loans in either direction, payments for services, rent, royalties and interest. Formation costs paid personally by the owner also count.
Is Form 5472 a tax return?: No, it is an information return. It does not calculate tax and filing it does not create a tax liability. That is precisely why it gets missed: founders with no US tax to pay assume there is nothing to file.
I have not filed for several years. What now?: The exposure is per year, so it compounds. Speak to a US tax practitioner about the options, which may include reasonable-cause relief depending on your circumstances. Doing nothing is the one approach that reliably makes it worse.

Sources

Last reviewed August 23, 2026. Verify against the primary source before acting.

Founders 8 does not provide tax advice. Tax residency depends on facts and rules specific to each jurisdiction — review your position with a qualified adviser.

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