US Company Formation from Georgia (the Country) (2026): US LLC or C-Corp, the 1% Small Business Regime, Foreign-Source Income and the Soviet-Era Treaty

*This guide is about the country of Georgia, in the South Caucasus, not the US state of Georgia.*

Few countries have attracted remote workers as quickly as Georgia. Many nationalities can stay a year without a visa, registration is simple, and an individual entrepreneur with small business status pays 1% of turnover. Tbilisi and Batumi now host thousands of foreign developers, designers and marketers, alongside a growing Georgian tech sector that sells to the USA and Europe.

For many of them, the question is whether to add a US company, and how it would interact with the Georgian regime. A US company can be formed from Georgia remotely. Whether it helps depends on a Georgian question that advisers still argue about: is income for work done in Georgia, for foreign clients, Georgian-source? This guide explains that debate, then covers US LLC formation and US C-Corp formation for Georgian residents.

In short: Georgian citizens and residents of Georgia (including foreigners) can own 100% of a US LLC or C-Corporation, formed remotely. Georgia exempts resident individuals' foreign-source income, but income for work actually performed in Georgia is widely treated as Georgian-source, which is why freelancers register as individual entrepreneurs with small business status (1% of turnover up to GEL 500,000 a year). A Georgian company pays 15% profit tax only when it distributes profits (the Estonian model). The USA applies the 1973 US–USSR treaty to Georgia, which generally exempts interest and royalties from US withholding but does not reduce the 30% on dividends. With UCB, a Wyoming LLC with EIN is $249 and a Delaware corporation with EIN is $358, all-in.

Who can form a US company from Georgia

A US company can belong to anyone. US states do not look at citizenship or country of residence. A Georgian citizen, a foreigner living in Tbilisi, a Georgian LLC (შპს) or an individual entrepreneur can own a US company outright, and one person can be both owner and sole manager. No US visa, SSN, US address or trip is required. Every US company needs a registered agent in its state, which is included for the first year in every UCB formation (see registered agent explained), and an EIN, which the IRS issues to foreign owners without an SSN or ITIN (see EIN for non-residents).

Use your passport for identity. A Georgian ID card is not accepted by US banks on its own. For proof of address, use a utility bill (Telasi, GWP, Magti or Silknet) or a bank statement with a translation. Foreign residents should use their current Georgian address consistently.

Georgia's rules that matter

Foreign-source income is exempt for individuals, but where is the work done?

Georgian tax law exempts a resident individual's income from foreign sources. For a passive investor, such as someone receiving dividends from a foreign company, interest abroad or rent on property abroad, that is generous and straightforward.

For someone who works from Georgia, it is not straightforward. The prevailing view among Georgian advisers is that income for services actually performed in Georgia is Georgian-source, even when the client is abroad. This is why most remote workers register as individual entrepreneurs with small business status: the 1% regime is the price of having Georgian-source income, and a very low one. Some advisers argue the opposite for particular facts, but the safe approach is to treat work done in Georgia as Georgian-source unless your adviser concludes otherwise.

Small business status

An individual entrepreneur with small business status pays 1% of turnover up to GEL 500,000 a year. Above that the rate rises, and exceeding the limit in consecutive years ends the status. Expenses are not deductible, and some activities, such as consulting and certain professions, are excluded. Services to foreign businesses are generally outside the scope of Georgian VAT.

Georgian companies: profit tax on distribution

A Georgian LLC pays corporate profit tax of 15% only when it distributes profits (or makes equivalent payments). Retained and reinvested profits are not taxed, on the model Estonia made famous. A dividend paid to an individual carries 5% personal income tax. Companies that qualify for International Company status, mainly IT and certain service exporters with real activity in Georgia, pay reduced rates.

The treaty with the USA

Georgia has not concluded a modern income tax treaty with the USA. The USA treats the 1973 income tax convention with the Soviet Union as still applying to Georgia:

• Interest and royalties paid from the USA to a resident of Georgia are generally exempt from US withholding.
• Dividends are not covered, so a US corporation's dividends to Georgia carry the full 30%.
• Business profits are taxable in the USA only through a permanent establishment there.

US LLC or individual entrepreneur?

For a freelancer living in Georgia, the comparison is stark. As an individual entrepreneur with small business status invoicing foreign clients directly, you pay 1% of turnover in Georgia. A US LLC in between does not take your work out of Georgia, so the income remains Georgian-source. To keep the 1% regime, the Georgian entrepreneur must be the one earning it.

A sensible arrangement for people who need a US entity is often:

• The US LLC contracts with US clients and receives payment in the USA.
• Your Georgian individual entrepreneur invoices the US LLC for the work done in Georgia, at a fee that reflects that work, and pays 1% on it.
• The LLC keeps only a modest margin for what it actually does in the USA, such as paying US contractors, tools and advertising.

Your Georgian adviser should confirm that this works for your activity and turnover.

US LLC formation from Georgia

The US side

A single-member LLC owned by a non-resident is disregarded by the IRS, which taxes its income as if the owner earned it directly. A non-resident owner working from Georgia, with no US office or US agents acting for the LLC, generally has no income connected with a US trade or business, so no US income tax is due (see effectively connected income explained). Money passing from the LLC to its owner is not a dividend, so the treaty's missing dividend relief does not matter. Each year the LLC must file Form 5472 with a pro forma Form 1120. The penalty for missing it is $25,000 (see Form 5472 explained).

A lari example

These are illustrative figures, not a client case, at GEL 2.7 to the dollar.

Anna, a German UX researcher living in Tbilisi, has three US clients who will only contract with a US company. She forms a Wyoming LLC. The LLC bills the clients US$96,000 a year and pays her Georgian individual entrepreneurship US$90,000 (about GEL 243,000) for her research and design work. At 1% under small business status, that costs GEL 2,430 in Georgian tax. The LLC keeps US$6,000 to pay a US participant-recruitment service.

In the USA, the LLC files Form 5472 and a pro forma 1120 and owes no income tax.

Anna must also check her position in Germany. If she has given up her German residence completely, Germany no longer taxes her, but the facts need to be clear (see the Germany guide).

US C-Corp formation from Georgia

The US side

A US C-Corporation is a taxpayer in its own right: 21% federal tax on its profits, plus state tax where it does business, with Form 1120 and Form 5472 filed each year (see the 21% corporate tax explained and the C-Corp guide for non-residents). Its dividends to a resident of Georgia are withheld at 30%, because the 1973 treaty has no dividend article.

Where it fits

• Georgian start-ups raising investment. The common structure is a Delaware C-Corporation parent with a Georgian LLC subsidiary that employs the team. The subsidiary is paid for development at arm's-length prices. Under the Estonian-model profit tax, the subsidiary's retained profit is not taxed until distributed, which suits a growing company. If the subsidiary licenses IP to the US parent, or the parent lends to it, royalties and interest flowing to Georgia benefit from the treaty's exemption from US withholding, if the arrangement is real and priced at arm's length. See raising US investment as a foreign founder.
• A Georgian company's US subsidiary with US staff or operations, which will pay US tax on its US profit anyway.
• Owners in several countries, which is common among Tbilisi's international founders.

Foreign residents of Georgia

Many readers of this guide are not Georgian. A few points apply especially to them:

• Visas and work rules. Georgia's visa-free stays for many nationalities have been generous. Changes to labour migration rules in 2026 have added work permit requirements for some foreigners working in Georgia. Check your position under the current rules.
• Home-country tax. Georgia's regime only helps if your home country no longer considers you resident. Europeans who keep a home or family in their home country can remain taxable there.
• US citizens and green card holders are taxed by the USA on worldwide income wherever they live, so a US LLC is not disregarded in the same way for them.
• Banking. Nationals of countries under broad US sanctions face extra restrictions from US banks even when living in Georgia. US banks will apply their own policies.

Which state

• Wyoming or New Mexico for a contracting LLC with no US premises.
• Delaware for any corporation that will raise investment.

See Wyoming LLC for non-residents, best state for non-residents and the state selector.

What it costs

Formation prices include the state fee and the first year of registered agent service:

• A Wyoming LLC with EIN is $249, or $348 with a US bank account application.
• A Delaware corporation with EIN is $358.

A Wyoming LLC costs $121 a year to keep active, or $421 including the annual federal return. A US business address with your own suite number is $60 a year. See what a US LLC costs every year.

Banking

US banks and fintechs generally accept residents of Georgia. Your nationality also matters to them, not only your residence. Applications go best with a specific business description, an English website, matching documents and a US business address with your own suite number. Moving money from the US account to TBC Bank or Bank of Georgia is a routine international transfer. See US business bank accounts for non-residents, why banks reject non-resident applications and Stripe for non-residents.

Common mistakes

• Assuming income through a US LLC is foreign-source and exempt in Georgia when the work is done in Georgia.
• Letting the US LLC keep most of the margin, so that little passes through your 1% Georgian entrepreneurship.
• Assuming the treaty reduces dividend withholding. It does not; dividends stay at 30%.
• Forgetting home-country tax as a foreign resident of Georgia.
• Missing Form 5472 in a year when the LLC owed no US tax.

Frequently asked questions

Can I own a US company while living in Georgia? Yes, whether you are Georgian or a foreign resident, without visiting the USA.

Is income from my US LLC tax-free in Georgia? Foreign-source income of individuals is exempt, but income for work you perform in Georgia is generally treated as Georgian-source. That is why freelancers use the 1% small business regime.

Can I keep my 1% small business status and have a US LLC? Yes, if your Georgian individual entrepreneur earns the income for the work, for example by invoicing the US LLC. Ask your Georgian adviser to confirm it for your activity.

Is there a US–Georgia tax treaty? The USA applies the 1973 US–USSR treaty to Georgia. It generally exempts interest and royalties from US withholding, but dividends stay at 30%.

Does my US LLC pay US tax? Not if it has no office, staff or agents in the USA. It files Form 5472 and a pro forma 1120 every year.

How UCB can help

We handle US company formation for Georgian citizens and foreign residents of Georgia remotely: the state filing, EIN, registered agent, US business address and bank application. Each year we file the federal return through our US tax filing service. Your Georgian adviser handles your individual entrepreneur or company filings, and we supply the US records they need. See our formation, EIN and bank account package.

Setting up a US company from Georgia? WhatsApp us at +1 315 961 2956 or email enquiries@ucbsolutions.com.