How to Start an IT Services or Software Development Company in the USA from Abroad (2026), Without Visiting: US LLC or C-Corp, EIN Without an SSN, Bank Account, Client Contracts, SOC 2 and Running an Offshore Team

Most offshore software firms reach the same point. The work is good, the references are strong, and US prospects still hesitate at the procurement stage. Their vendor portal wants a US tax ID. Their legal team wants a contract governed by US law. Their finance team pays by ACH on net-45 and has no process for an international wire to a company it cannot look up.

A US company solves most of that. It can be formed, given an EIN and a bank account without anyone travelling to the USA, and it lets an IT services firm in Pune, Kraków, Ho Chi Minh City or Buenos Aires sell to American clients as a US vendor while the engineering stays where it is.

This guide covers what an IT services, software development or IT consulting business specifically needs: the right entity, the vendor paperwork US clients ask for, contracts and IP, security reviews, tax, and how the US company fits with the team you already have at home.

In short: Non-residents can form a US LLC or C-Corporation remotely, get an EIN without an SSN or ITIN, and open a US business bank account without visiting. For an IT services firm, the US company signs the client contracts, invoices in dollars and receives ACH payments; the development usually stays with your team abroad, often in your existing home-country company under an intercompany agreement. A foreign-owned single-member LLC whose work is all done outside the USA usually owes no US federal income tax but must file Form 5472 every year. A C-Corp pays 21% federal tax on its profit and suits firms raising investment or planning a US office. Expect US clients to ask for an MSA and SOWs, an IP assignment, insurance certificates and, for larger accounts, a security questionnaire or SOC 2 report.

Why IT firms set up a US company

An offshore firm can sell to US clients without a US company, and many do. A US entity changes three things that matter in this industry.

Procurement. US enterprise and mid-market buyers onboard vendors through portals such as Coupa, Ariba or their own ERP. Many of these assume a US address, a US bank account for ACH and a US tax form. A foreign vendor is possible but often goes through a slower, separate route, and some companies simply do not set it up for small contracts.

Contract risk. A US client's lawyer is comfortable with a Delaware or Wyoming company, a US governing law clause and a counterparty they can sue in a US court. Contracting with a company in another country raises questions about enforcement that slow the deal.

Payments. With a US account, clients pay by ACH at no cost to them. You avoid intermediary bank fees on every wire, and you choose when to convert dollars to your home currency.

What a US company does not change is where the work is done. If your developers are in India, Poland or Vietnam, they keep working there. That fact drives most of the tax answers below.

Can you set it up without visiting the USA?

Yes. Every step is done remotely:

The full sequence and timing are in our guide to opening a US company without visiting. In short: the company is formed within days, the EIN for an owner without an SSN usually takes one to four weeks, and the bank account follows. Four to eight weeks from order to a working account is realistic.

Getting an EIN without an SSN

The IRS online EIN application only works when the responsible party has an SSN or ITIN. A foreign owner without either applies on Form SS-4, which the IRS processes manually. You do not need an ITIN to get an EIN, to open a bank account or to sign client contracts. See EIN for non-residents.

Opening a US business bank account without visiting

Traditional banks such as Chase or Bank of America usually want the signer in a branch. Fintech business accounts accept foreign-owned companies online, though each keeps its own list of countries and industries it serves. IT services and software development are among the easiest businesses to bank, because the activity is simple to explain and to evidence. Have these ready:

• a website that shows your services, team and past work
• a sample contract or a signed statement of work with a client, if you have one
• a short, specific description: "custom web and mobile development for US healthcare and fintech companies", not "IT solutions"

Why some applications still fail, and how to avoid it, is covered in why banks reject non-resident applications and the US business bank account guide.

US LLC or C-Corporation for an IT services company?

Both can be formed remotely. The choice depends on how you plan to grow.

US LLC formation for an IT services firm

A single-member LLC owned by a non-resident is, by default, a disregarded entity for US tax. If all the work is performed outside the USA and the company has no US office, employees or dependent agents, it usually has no income effectively connected with a US trade or business, and so no US federal income tax. It still files Form 5472 with a pro forma Form 1120 every year, and missing it carries a $25,000 penalty. See Form 5472 explained.

An LLC suits:

• consultancies and agencies run by one or two founders
• firms that bill US clients and pay a team abroad
• owners who will be taxed on the profit in their home country anyway

Typical cost: a Wyoming LLC with EIN is $249, and with a business bank account $348. Keeping it active costs $121 a year.

The catch: a disregarded LLC's profit is generally taxed in the owner's country of residence, and some countries treat a US LLC differently from how the USA does. Check how yours classifies it before you form; the country guides in our US company from abroad hub cover this country by country.

US C-Corp formation for an IT services firm

A C-Corporation is a separate taxpayer. It pays 21% federal corporate tax on its own profit, and dividends to a foreign owner face 30% withholding unless a treaty reduces it.

A C-Corp suits:

• firms planning to raise venture capital or sell equity to US investors
• companies that will hire US employees, open a US office or put sales staff in the USA
• groups where the US company will own IP or sign large enterprise contracts that expect a corporation

Typical cost: a Delaware corporation with EIN is $358, and $578 a year to keep active. See LLC vs Inc for non-residents and the C-Corporation guide.

Which state?

For a service firm with no US office, Wyoming and New Mexico are cheap and simple, and Delaware is the default for a C-Corp that will raise money. Clients rarely care which state you choose. What they check is that the company is in good standing, which means paying the yearly state fee and filing the annual report on time. See best state for an LLC.

The two-company model

Most established IT firms do not move their business into the US company. They add it on top:

1. The US company signs the client contract, invoices the client and receives payment.
2. Your home-country company (the development centre) does the work under an intercompany services agreement and invoices the US company.
3. The US company keeps a margin that reflects what it actually does.

This is how most Indian, Eastern European and Latin American software houses with US clients are structured, at every size.

Transfer pricing

When two related companies trade, both countries expect the price to be what independent parties would agree: the arm's-length price. If the US company is a simple sales and contracting front with no US staff, a modest margin is usually right, and most of the profit stays with the development centre, which does the work. If the US company has US sales staff and takes the client risk, it should keep more.

Write the intercompany agreement before the first invoice, price it on a stated method (often cost plus a mark-up for the development centre), and keep the calculation. Tax authorities in India, Poland, Brazil and other countries with active transfer pricing audits look at exactly these flows.

Form 5472 and related-party flows

Every payment between the US company and a related foreign company, and every contribution or distribution between the company and its owner, is a reportable transaction on Form 5472. Record them as they happen, not at year-end.

Your home-country rules on owning a US company

Some countries regulate their residents' foreign investments:

• India: a resident individual or Indian company setting up a US company does it as an Overseas Direct Investment (ODI) under FEMA, through an authorised dealer bank, with reporting. See ODI and FEMA rules and how to register a company in the USA from India.
• Other countries have controlled foreign company (CFC) rules that can tax a low-taxed US company's profit in your hands even if you leave it in the USA.

The country guides cover the specific rules.

What US clients will ask you for

Winning the contract is half the work. Getting through vendor onboarding is the other half. These are the requests an IT services vendor should expect.

A tax form: W-9 or W-8

• A C-Corporation is a US person and gives a Form W-9 with its EIN.
• A single-member LLC owned by a non-resident is disregarded, so the form reflects the owner: usually a W-8BEN (individual owner) or W-8BEN-E (company owner) showing the LLC's name, or a W-8ECI if the income is effectively connected with a US business.

Clients' procurement teams often ask for a W-9 by default. Giving one when you are not a US person is wrong and can cause problems later; explain the correct form instead. See W-8BEN-E vs W-8BEN explained.

An MSA and statements of work

US software clients usually contract in two layers:

• a Master Services Agreement (MSA): the legal terms (liability caps, indemnities, confidentiality, IP, payment terms, termination, governing law)
• one Statement of Work (SOW) per project: scope, deliverables, milestones, rates, acceptance

Large clients send their own paper. Smaller ones expect you to. Read the liability cap and the indemnity carefully: an uncapped indemnity for IP infringement or data breach is the clause most likely to hurt a small firm. More in contracts with US clients.

An IP assignment that actually works

This is the clause offshore firms most often get wrong. Under US copyright law, software written by an independent contractor is not automatically a "work made for hire" belonging to the client, because software is not one of the categories the statute lists. The client only owns it if there is a written assignment.

The chain has to be complete:

1. Your developers (employees or contractors) assign their work to your home-country company, under local law.
2. Your home-country company assigns to the US company under the intercompany agreement.
3. The US company assigns to the client under the MSA, usually on payment.

A US client's due diligence, or a later acquirer's, will ask for this chain. If any link is missing, the client may not own the code it paid for.

Insurance certificates

Mid-size and enterprise clients often require proof of:

• professional liability / errors and omissions (E&O), commonly $1 million to $2 million
• cyber liability, especially if you touch client data or production systems
• commercial general liability, sometimes

A US company makes it easier to buy US-standard cover and to issue a certificate of insurance (COI) naming the client as an additional insured, which is what procurement wants to see.

Security questionnaires and SOC 2

Any client that gives you access to its code, cloud accounts or customer data will send a security questionnaire, often the SIG, CAIQ or a custom spreadsheet of 100 to 300 questions. Larger clients ask for a SOC 2 report.

• SOC 2 Type I examines whether your controls are designed properly at one point in time.
• SOC 2 Type II tests whether they operated over a period, usually 3 to 12 months.

A SOC 2 is issued by a licensed CPA firm and typically costs tens of thousands of dollars including the tooling, so many firms start with a well-documented security policy, ISO 27001 if they already hold it, and good answers to the questionnaire. The report covers your systems and people, wherever they are, so the work happens mostly at your development centre.

Data protection terms

If you process personal data for US clients, expect a data processing agreement. Health clients will ask for a HIPAA business associate agreement (BAA); financial clients will apply GLBA expectations. EU clients' data brings the GDPR, and your own country's law, such as India's Digital Personal Data Protection Act, also applies to what your team does with it.

Sales tax on software services

The USA has no federal VAT, but most states have sales tax, and its treatment of software varies:

• Custom software development and IT consulting are generally not taxable in most states.
• Prewritten (off-the-shelf) software, and in many states SaaS, can be taxable.
• A few states tax some IT or data processing services. Texas, for example, taxes data processing services on 80% of the charge.

A firm doing custom work for clients is usually outside sales tax, but read the rules for any state where you sell licences or hosted products, and check whether your sales cross that state's economic nexus threshold. See state taxes for foreign-owned LLCs.

When your team or you work in the USA

The "no US tax" answer for a foreign-owned LLC rests on the work being done outside the USA. It changes when people travel:

• Short client visits for meetings, kick-offs and negotiations are normally fine on a B-1 visa or ESTA.
• Hands-on billable work in the USA, such as on-site development or deployment, is US-source income. It can create a US trade or business, and the person doing it needs the right work visa.
• A developer living in the USA working for the company makes that part of the income effectively connected, and a US employee brings payroll and state registration.

If you plan on-site work, structure it deliberately. See effectively connected income explained and hiring in the USA as a non-resident company.

Paying your team abroad from the US company

If the US company contracts freelancers abroad directly rather than through your home-country company:

• collect a W-8BEN or W-8BEN-E from each before the first payment
• services performed entirely outside the USA are not US-source income: no US withholding and no Form 1099
• check local employment law, because a long-term, full-time "contractor" may be an employee in their country

Full detail in paying contractors abroad from a US company.

Getting paid

US clients pay IT vendors by ACH (most common, often net-30 to net-60), wire for larger invoices, and card through Stripe or invoicing tools for smaller clients. With a US account:

• invoice in USD from the US company, in its exact legal name
• give clients your ACH routing and account numbers on the invoice and in the vendor portal
• move funds home by international transfer when you choose; see receiving payments from US clients

Late payment is normal in enterprise accounts. Build it into your cash flow, and make sure your contract states the payment terms and late fees.

Worked examples

These are illustrative examples, not client stories.

A development agency in Pune. Meera and Arjun run a 25-person private limited company building web and mobile apps. Three US prospects stalled in procurement. They form a Wyoming LLC, owned by their Indian company under the ODI route, with an EIN and a US bank account. The LLC signs MSAs with US clients and subcontracts the delivery to the Indian company at cost plus a mark-up set out in an intercompany agreement. The Indian company exports services under its GST letter of undertaking. The LLC files Form 5472 and a pro forma 1120 each year. Because the US company is owned by a company rather than an individual, they check with their Indian adviser whether it should elect to be taxed as a corporation instead.

A QA consultancy in Kraków. Tomasz is the sole owner of a Polish testing firm. A US fintech client asks for SOC 2 and a W-9. Tomasz forms a Delaware C-Corp, because the client wants a US corporation and the plan is to hire a US account manager next year. The corporation gives a W-9, buys E&O and cyber cover, and starts a SOC 2 Type I covering the Polish operations. It pays 21% on the profit it keeps, and the intercompany pricing with the Polish company is documented for both tax authorities.

A solo developer in Buenos Aires. Valentina works for two US start-ups and forms a single-member LLC to invoice them in dollars into a US account and gives each client a W-8BEN for the LLC, as its foreign owner. All the work is done in Argentina, so the LLC has no US income tax, and the profit is reported in Argentina. The yearly cost is the state renewal and the Form 5472 filing.

Common mistakes

• Giving clients a W-9 from a foreign-owned single-member LLC because their portal asked for one.
• No written IP assignment from developers to the company, so the client's ownership has a gap.
• Signing an MSA with uncapped indemnities for data breach or IP infringement.
• Running all revenue through the US company with no intercompany agreement, leaving the home-country company's costs unexplained to its tax authority.
• Sending developers to work on-site in the USA on ESTA, which risks both immigration and US tax problems.
• Forgetting Form 5472 because the LLC "made no US income".
• Letting the state annual report lapse, so the client's vendor check finds the company not in good standing.

Frequently asked questions

Can a foreigner start an IT company in the USA without visiting? Yes. Forming the LLC or corporation, getting the EIN, and opening a bank account can all be done remotely.

Do I need an SSN or ITIN to get an EIN for my software company? No. A foreign owner applies with Form SS-4. An ITIN is only needed for certain tax returns or platforms.

Will my US LLC pay US tax if my developers are all in India? Usually not, if it is a single-member LLC with no US office, staff or agents and all the work is done abroad. It still files Form 5472 every year.

Should an IT services firm choose an LLC or a C-Corp? An LLC for a lean contracting company owned by individuals. A C-Corp if you will raise investment, hire in the USA or need a corporation for large clients.

Do US clients require SOC 2 from offshore developers? Larger clients often do. Smaller ones usually accept a security questionnaire, policies and, if you have it, ISO 27001.

How UCB can help

We form US LLCs and C-Corporations for IT services and software firms outside the USA, get the EIN without an SSN, and help open a US business bank account without visiting, through our formation, EIN and bank account package. Each year we prepare the US filings, including Form 5472 with the pro forma 1120, Form 1120 for corporations and Form 1065 for multi-member LLCs, through our US tax filing service. We do not draft client contracts, run SOC 2 audits or arrange insurance.

Setting up a US company for your IT or software business? WhatsApp us at +1 315 961 2956 or email enquiries@ucbsolutions.com.