US Company Formation from Kyrgyzstan (2026): The High Technology Park, the Old US–USSR Treaty, Sanctions Due Diligence and the US LLC vs C-Corp Choice

Kyrgyzstan has built a lively IT export sector on a small base. Bishkek's developers, QA engineers, designers and game studios sell to clients in Europe and North America, helped by the High Technology Park (HTP), a tax regime for IT exporters that the government made permanent in 2024. Freelancers work through international platforms, and a growing number of start-ups want US customers and US investors.

For all of them, a US company raises three questions particular to Kyrgyzstan: how a Kyrgyz IT company in the HTP should own and use it; which payments the old 1973 US–USSR tax treaty still protects; and why US banks now apply sanctions due diligence to applicants from Kyrgyzstan. This guide answers each one, then compares US LLC formation with US C-Corp formation.

In short: Kyrgyz citizens and residents can own 100% of a US LLC or C-Corporation, formed remotely. Kyrgyzstan taxes residents on worldwide income at a flat 10%, and company profits at 10%. HTP residents that export IT services are exempt from profit tax, VAT and sales tax, pay a contribution to the HTP based on revenue, and their employees pay 5% income tax. The 1973 US–USSR treaty, which the IRS still applies to Kyrgyzstan, exempts interest and royalties from US withholding, but dividends from a US corporation carry 30%. US banks look closely at Russia sanctions risk, especially since the Keremet Bank designation in 2025. With UCB, a Wyoming LLC with EIN is $249 and a Delaware corporation with EIN is $358, all-in.

Sanctions due diligence comes first

In January 2025 the US Treasury designated Keremet Bank, a Kyrgyz bank, for helping a sanctioned Russian bank move money across borders. The United Kingdom followed. Kyrgyzstan's government contests the designation, and the National Bank of the Kyrgyz Republic has repeatedly told commercial banks to tighten sanctions compliance.

For a Kyrgyz business opening a US account, this means more questions than a few years ago. US banks and fintechs want to see that:

• the business is real and its customers are outside Russia's sanctioned sectors;
• money will not pass through sanctioned banks or to sanctioned people;
• the owner and the company have no connection with sanctioned Russian entities;
• goods, if any, are not dual-use items that could be re-exported to Russia.

An IT company in Bishkek with clients in the USA, Europe or Asia, paid directly, passes these checks. One with mainly Russian clients, Russian payment routes or Russian shareholders will struggle, and may be refused outright.

Practical points:

• Bank in Kyrgyzstan with a bank that has strong correspondent relationships, and avoid banks named in sanctions actions.
• Keep a list of your main clients, with countries, and contracts in English.
• If you have Russian clients, explain how they pay and confirm they are not sanctioned. Some US providers will still decline.

How Kyrgyzstan taxes residents and companies

• Residence: individuals present in Kyrgyzstan for 183 days or more in any 12-month period, or with their centre of vital interests there, are residents and are taxed on worldwide income.
• Personal income tax: a flat 10% on most income, with special regimes such as patents and the single tax for small businesses.
• Profit tax: 10% for most companies.
• Foreign tax credit: foreign tax paid on foreign income is credited, up to the Kyrgyz tax on the same income.

For an owner of a US company:

• Work you do in Kyrgyzstan is Kyrgyz income, whichever company invoices it.
• Distributions or dividends from a US company are foreign income, with credit for US withholding. Ask your accountant how dividends from a foreign company are taxed under the current Tax Code.

The High Technology Park

The HTP is a legal regime, not a physical park. Kyrgyz companies whose business is developing and exporting software and IT services can apply to become HTP residents. As residents:

• they are exempt from profit tax, VAT and sales tax on qualifying activity;
• they pay contributions to the HTP directorate, calculated as a percentage of qualifying revenue;
• their employees pay personal income tax at 5%, with social contributions on a reduced base;
• since 2024, the regime is indefinite. Before that, it had a fixed end date.

How a US company fits with an HTP resident

The usual set-up is for the HTP resident to own the US company, and for the US company to pay the HTP resident for development work:

• the US company signs US clients, invoices them and receives US payments;
• the HTP resident does the work in Kyrgyzstan and invoices the US company, so its export revenue is in the HTP regime;
• the US company keeps only what it needs for US costs and, if it has US staff, a margin for its US activity.

This keeps the IT revenue inside the HTP regime, where it is taxed lightly, and uses the US company for what it does best: contracts, payments and US presence. Check the HTP's current rules on qualifying revenue and on owning foreign subsidiaries.

The 1973 US–USSR treaty

When the Soviet Union broke up, the USA continued to apply the 1973 US–USSR income tax treaty to several successor states. The IRS lists Kyrgyzstan as one of them. The treaty is narrow:

So:

• A US corporation paying dividends to Kyrgyzstan withholds 30%.
• A US company paying royalties for software or IP licensed by a Kyrgyz company can pay them free of US withholding, with a W-8BEN-E treaty claim (see W-8BEN-E vs W-8BEN explained).
• Interest on a loan from a Kyrgyz owner to a US company is likewise exempt, subject to the US interest deduction rules.

For a Kyrgyz IT company with a US corporation, this makes licence fees and service fees more efficient ways to move profit than dividends, as long as the amounts are at arm's length.

US LLC formation from Kyrgyzstan

US tax position

The IRS disregards a single-member LLC with a non-resident owner. If the owner, whether a person or an HTP company, works from Kyrgyzstan and the LLC has no US office, employees or dependent agents, its income is generally not connected with a US trade or business and is not taxed in the USA (see effectively connected income explained). The LLC files Form 5472 with a pro forma Form 1120 every year, and the penalty for missing it is $25,000 (see Form 5472 explained).

Example: a QA engineer in Bishkek

These are illustrative figures, not a client case, at KGS 87 to the dollar.

Aibek is a test-automation engineer in Bishkek with three US software clients. They want a US vendor and pay by ACH. He forms a Wyoming LLC, opens a US business account, and the LLC bills US$54,000 a year.

• USA: no US tax, because he works only in Kyrgyzstan. The LLC files Form 5472 and a pro forma 1120.
• Kyrgyzstan: he declares the income (about KGS 4.7 million) as a resident individual entrepreneur, taxed under the regime he is registered for, at or below the 10% flat rate.
• Banking: his US bank application lists his three US clients and explains that he has no Russian clients. His Kyrgyz bank receives transfers from the LLC with invoices.

US C-Corp formation from Kyrgyzstan

US tax position

A US corporation pays 21% federal tax on its profits plus state tax, and files Form 1120 and Form 5472 every year (see the 21% corporate tax explained and the C-Corp guide for non-residents). Dividends to Kyrgyzstan are withheld at 30%, with no treaty reduction.

Example: a Bishkek game studio

Take an illustrative case: a Bishkek studio that develops mobile games is an HTP resident with 40 staff. A US publisher and two US investors want to invest in a US company. The founders form a Delaware corporation:

• The Delaware corporation owns the games' IP going forward, signs the publishing deal and receives investment. It is taxed at 21% on its US profits.
• The Kyrgyz HTP company becomes its development subsidiary or contractor. It invoices the Delaware corporation for development at cost plus a margin, which is taxed in the HTP regime.
• Royalties for any IP the Kyrgyz company keeps can be paid by the US company free of US withholding under the 1973 treaty.
• Dividends are avoided while the company grows, because they would lose 30%.

See raising US investment as a foreign founder and US subsidiary for a foreign company.

Which state

• Wyoming or New Mexico for a freelancer's or IT company's services LLC.
• Delaware for a corporation, especially one taking investment.

Kyrgyzstan keeps a government list of jurisdictions with preferential tax treatment, so ask your accountant whether any US state on it affects your reporting before you choose. See best state for non-residents and the state selector.

What it costs

UCB's prices include state fees and the first year of registered agent service:

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

A Wyoming LLC costs $121 a year to keep active, or $421 with the annual federal return. A Delaware corporation costs $578 a year. A US business address with your own suite number is $60 a year. See what a US LLC costs every year.

Documents

Use your Kyrgyz international passport, not the internal ID card. For proof of address, a Severelectro electricity bill, a gas or water bill, or a bank statement, translated into English. Use the Latin spelling in your passport on every document, not a transliteration of your own.

For a company-owned US entity, you need the Kyrgyz company's registration certificate and charter, translated into English, and the HTP resident certificate if it has one.

See US business bank accounts for non-residents and why banks reject non-resident applications.

Mistakes to avoid

• Applying to US banks without explaining your client base and sanctions exposure.
• Routing payments through sanctioned banks or Russian payment systems.
• Leaving HTP revenue in the US company instead of paying the HTP resident for its work.
• Paying dividends from a US corporation to Kyrgyzstan at 30% when royalties or fees would be exempt.
• Missing Form 5472 in a year when no US tax was due.

Frequently asked questions

Can a Kyrgyz citizen own 100% of a US company? Yes. No US visa, Social Security number or visit is required.

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

Can my HTP company own a US company? Yes. Usually the HTP company owns the US company, and the US company pays it for development work. Check the HTP's current rules.

Will US banks accept me? Yes, if your business and clients are clearly outside Russia sanctions risk. Expect detailed questions.

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

How UCB can help

We form US companies for Kyrgyz owners remotely, in Russian or English: the state filing, EIN, registered agent, US business address and bank application. We help you prepare the client and sanctions information US banks ask for. Each year we file the federal return through our US tax filing service. See our formation, EIN and bank account package, and the Kazakhstan and Uzbekistan guides for the neighbouring rules.

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