The recommended structure is a U.S. company (LLC or Corporation) where the investment fund acts as the central entity. Foreign investors can participate as partners, but it’s important to clearly define whether the fund will only make passive investments or also manage assets.
Not necessarily. If the company is investing in real estate (such as residential or commercial properties) and is not actively managing third-party money, no financial license is required. Only certain activities, such as crypto operations, do require specific licenses.
Foreigners are subject to a 15% withholding of the sale value under FIRPTA. This is a tax requirement to ensure payment of taxes on the sale of real estate.
Yes, it is recommended to create one LLC for each project to facilitate management of construction permits and to separate legal and tax responsibilities for each property or investment.
Yes. You can open an account at banks like Signature Bank to receive funds from abroad. This makes transfers for U.S. projects easier without the need for intermediaries.
It is possible, but you need to apply for specific licenses, depending on the state or jurisdiction. Some countries, such as Malta, offer favorable regulatory frameworks if you wish to consider alternatives outside the U.S.
You should structure a solid legal model, present proven track records of profitability, and establish well-defined contracts. It’s also helpful to have a holding company that centralizes the management of various investment vehicles.
The personal guarantee allows the bank to recover the property if the borrower does not pay. In Ecuador, banks do not allow properties to be registered under the name of an LLC (limited liability company) from the start, because they would lose that personal guarantee. Although some do it later, personal liability still exists if payments are not made.
Technically yes, but it depends on the terms of the mortgage contract. Some banks do not allow it, and others may penalize you. You should always review the mortgage deed or consult with a real estate attorney before doing so.
Warehouses and medical or dental offices are more stable options. Traditional office spaces are in decline because many people are working from home after the pandemic.
It’s a loan where you only pay the interest for a period of time. It is generally used when you plan to sell the property in the short term. It’s common in commercial investments, such as buying a warehouse with the goal of resale.
During the pandemic, many people took advantage of increased home values to refinance or take out lines of credit. This was useful to have liquidity or to invest.
Yes, as long as the vehicle is used exclusively for the business and is labeled with the company’s name. In that case, the associated expenses are deductible. If it’s for personal use, you can only deduct a limited percentage (for example, 50%).
No, personal expenses such as moving, buying furniture, or materials are not deductible unless they are directly related to a business.
There is a high legal and financial risk. It’s important to make sure you comply with local regulations before carrying out additional construction.
Yes. If part of your primary residence is rented out, you can allocate a portion of the mortgage interest and property taxes against your W-2 income, and use depreciation against rental income. Depreciation losses up to $25,000 may also be used to offset your W-2 income if you qualify.
Depreciation applies only to the rental portion. So if you rent out 50% of the property, only that portion can be depreciated and deducted from rental income. If there's a net passive loss, up to $25,000 can offset your active income (W-2), provided you meet income limits and are actively involved.
If you actively participate in managing the rental and your adjusted gross income is under $150,000, you can deduct up to $25,000 in rental losses against your non-passive income like W-2 wages.
Yes, bonus depreciation applies to short-term rentals if you are materially participating in the activity. In 2025, you can depreciate up to 80% of the property cost immediately. This bonus depreciation can be used to offset W-2 income if the activity qualifies as non-passive.
To qualify for a second home loan, you typically must use the property for at least 14 days or 10% of the days it’s rented out. But to maintain short-term rental status for IRS purposes, you must not use it personally more than 14 days per year. Meeting both conditions often requires staying exactly 14 days in the home.
The IRS uses statistical models to identify unusual returns. If your deductions or losses are much higher than typical, your return might be flagged for audit. Higher-income earners ($500K+) are more likely to be audited.
Yes, you can form an LLC in the U.S. as a foreigner without physically residing in the country. The entire process can be completed remotely.
You only need a valid passport, a foreign address, and possibly an official translation. With this, the process can begin.
Yes, though a minimum balance (e.g., $10,000 USD) may be required to keep the account active. The account holder must not have any criminal or public charges.
Not necessarily. If there are no transactions or income, tax obligations may be minimal. But if there’s business activity, annual filings are required.
The state tax rate ranges from 5.5% to 8%, depending on income. Annual reports and tax filings are also required.
Yes. As long as expenses are backed by invoices and payments through business bank accounts, they are deductible for tax purposes.
Yes, you can receive international transfers into the business account. Funds can then be transferred to personal or associated accounts with proper documentation.
No. Owning an LLC does not guarantee a visa. Business visas like the E-2 or L-1 require a separate formal application process.
Florida does not offer anonymity for owners, while New Mexico may offer more privacy. However, Florida is more business-friendly for certain industries due to its tax structure.
The process can take from a few days to a few weeks, depending on documentation and bank response times. Registration can also be completed by mail if needed.
If you're not a U.S. tax resident, they shouldn't withhold 30%. It's possible to request a refund if you can prove you're a foreign entity and the payments were made to a non-U.S. company. The amount retained must be calculated and documentation submitted to the IRS if applicable.
As long as you live outside the U.S. and your income doesn’t originate from U.S. operations, you’re not required to file federal taxes. However, once you become a U.S. resident, you'll need to keep your accounting up to date and declare your income.
You should separate personal and business income. If you're currently being paid personally, it's best to transition future earnings to a business account once your U.S. company is registered. Clear recordkeeping will be essential for future compliance.
Yes. You can structure your Honduran company as a vendor for your future U.S. entity. This setup helps manage intercompany transfers and maintain proper accounting, as long as it complies with local and U.S. tax laws.
If you’re a foreign owner, reside outside the U.S., and haven’t taken distributions, you may not owe U.S. federal taxes. However, it’s essential to keep your accounting organized in case you take distributions later on.
Some banks offer mortgages to foreigners, but they often require a 25–30% down payment. Once you obtain residency, you might qualify for better terms—like a 3% down payment—if your credit score is strong.
HARPTA (Hawaii Real Property Tax Act) is a state tax law that requires non-resident sellers to withhold 7.25% of the sale price of real estate in Hawaii. It's similar to FIRPTA, but HARPTA applies at the Hawaii state level, while FIRPTA is at the federal level with the IRS. Both ensure taxes on capital gains are collected from non-residents, with HARPTA targeting state obligations and FIRPTA addressing federal requirements.
If the company changes partners, it must notify the Department of Financial Services and the U.S. Treasury, and each new partner must go through the regulatory authority.
Details for the GA MSB application: They require a US citizen as owner.
⇒ GA company registration
⇒ Credit report
⇒ Resident GA agent
⇒ Employees’ primary contact (contact and consumer complaint)
⇒ Fingerprints
⇒ Surety bond $100K
⇒ Business plan
⇒ AML policy
For GA there are more requirements that in FL. GA requires hiring employees before applying for the license as well as a business plan and AML policy and one owner should be US resident. GA does not require audited financial statements but does require a business plan and AML policy.
No, an MSB license obtained in Illinois only authorizes you to conduct business and receive clients in Illinois. If you wish to operate in other states, such as Texas or Florida, you will likely need to obtain separate MSB licenses for each state, depending on their individual regulations.
Because they operate in multiple states. When your client base grows and you begin doing business across state lines, each state may require you to obtain an additional MSB license to remain compliant.
Yes, that is a good strategy. Start with Illinois, then pursue licensing in other states gradually over time. You mentioned a 3-year timeline for expenditure, which is reasonable.
⇒ From a company in Illinois
⇒ Hiring a compliance officer
⇒ Rent a physical office
⇒ Possibly obtain a surety bond and demonstrate capital reserves (usually $100,000 in capital and an additional financial guarantee)
Yes, the MSB license allows you to open one or more business bank accounts. However, what you can do with those accounts will depend on the type of program you implement (e.g., Visa partnership, prepaid solutions, etc.).
⇒ The legal name and address of the applicant, including any fictitious or trade names used by the applicant in the conduct of its business.
⇒ The name, social security number, alien identification or taxpayer identification number, business and residence addresses, and employment history for the past 5 years for each officer, director, responsible person, the compliance officer, each controlling shareholder, and any other person who has a controlling interest in the money services business.
⇒ A description of the organizational structure of the applicant, including the identity of any parent or subsidiary of the applicant, and the disclosure of whether any parent or subsidiary is publicly traded.
⇒ The applicant’s history of operations in other states if applicable and a description of the money services business or deferred presentment provider activities proposed to be conducted by the applicant in this state.
⇒ If the applicant or its parent is a publicly traded company, copies of all filings made by the applicant with the United States Securities and Exchange Commission, or with a similar regulator in a country other than the United States, within the preceding year.
⇒ The location at which the applicant proposes establishing its principal place of business and any other location, including branch offices and authorized vendors operating in this state. For each branch office and each location of an authorized vendor, the applicant shall include the non-refundable fee required.
⇒ The name and address of the clearing financial institution or financial institutions through which the applicant’s payment instruments are drawn or through which the payment instruments are payable.
⇒ The history of the applicant’s material litigation, criminal convictions, pleas of nolo contendere, and cases of adjudication withheld.
⇒ The history of material litigation, arrests, criminal convictions, plea of nolo contendere, and cases of adjudication withheld for each executive officer, director, controlling shareholder, and responsible person.
Yes, if your investors are in the U.S., you must register the offering with the SEC—even under Reg D. This process typically takes about one year.
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