Did you know that 42% of small businesses in the U.S. are LLCs?

This statistic highlights their popularity among domestic and international entrepreneurs alike. However, choosing between an LLC (Limited Liability Company) and a Corporation requires careful consideration of factors like taxes, asset protection, and scalability.

Selecting the right business structure can significantly impact your company's growth and success. LLCs offer flexibility and tax benefits, while Corporations make it easier to raise capital through stock issuance. In this article, we'll help you understand the key differences so you can make an informed decision, and we'll show you how Dasbanq can assist you in forming your U.S. company and opening a business bank account remotely.

Understanding U.S. Business Structures

Forming a business in the United States requires an understanding of the two most popular structures: LLCs and Corporations. Each offers distinct benefits and challenges, and the right choice depends on your business goals, operational needs, and growth plans.

What is an LLC?

An LLC combines limited liability protection with the tax flexibility of a partnership. Members can be individuals or entities, with no nationality restrictions, making it an excellent option for international entrepreneurs. It protects personal assets from business liabilities, providing peace of mind for business owners. Additionally, LLCs benefit from pass-through taxation, which means that profits are taxed only once, on the members' personal tax returns. The management structure is also flexible, allowing members to manage the business directly or appoint external managers.

The cost of forming an LLC varies by state. For example, in Wyoming or Montana, it ranges from $397 to $450, depending on the services selected with Dasbanq. Our team assists clients with the entire process, from filing the Articles of Organization to obtaining the EIN (Employer Identification Number).

What is a Corporation?

A Corporation is a separate legal entity from its owners, known as shareholders. This structure provides robust liability protection and the ability to issue stock, making it an attractive option for businesses planning to seek external investment. Corporations are typically more structured, with a board of directors, appointed officers, and regular compliance requirements such as annual meetings and detailed records.

Corporations can be classified as either C-Corporations or S-Corporations, with differences mainly in taxation. C-Corporations face double taxation (profits are taxed at the corporate level and again when distributed as dividends), while S-Corporations benefit from pass-through taxation if they meet specific requirements. Delaware remains a top state for incorporation due to its business-friendly environment and strong legal protections.

Key Differences Between LLCs and Corporations

While both LLCs and Corporations offer limited liability protection, they differ significantly in structure, taxation, and operational requirements. LLCs are known for their simplicity and flexibility, which appeals to small businesses and startups. Corporations, on the other hand, offer advantages in terms of fundraising and long-term growth potential.

Ownership differs in that LLCs are owned by members who can be individuals or entities, while Corporations are owned by shareholders who may transfer ownership by selling stock. From a tax perspective, LLCs typically have pass-through taxation, while Corporations, unless classified as S-Corps, face double taxation. Additionally, LLCs have fewer reporting and operational requirements compared to Corporations, which must adhere to more rigid governance standards.

Dasbanq Insight: Dasbanq simplifies the process of forming either structure by providing tailored solutions, including registered agent services, EIN applications, and 100% online banking access.

Why Choose an LLC with Dasbanq?

LLCs have become a popular choice for international entrepreneurs due to their simplicity and flexibility. Dasbanq offers personalized assistance to guide you through the entire process of forming an LLC in the U.S. Our services ensure that your LLC is properly registered and compliant with state and federal regulations.

An LLC provides flexibility in profit distribution, allowing members to allocate profits according to the terms outlined in the operating agreement rather than ownership percentage. Additionally, the absence of corporate-level taxation can translate into significant savings.

Through Dasbanq's streamlined process, clients can form their LLC and open a U.S. business bank account remotely. We provide expert guidance on selecting the most suitable state based on your business type and growth plans.

Why Choose a Corporation with Dasbanq?

Corporations are often the preferred structure for businesses with growth ambitions that include raising capital through stock issuance. Dasbanq assists clients in setting up their Corporation, ensuring compliance with all legal requirements. Our team helps prepare corporate bylaws, appoint directors, and file the necessary documentation with the state.

Corporations are ideal for businesses planning to go public or attract external investors. The ability to issue different classes of stock makes Corporations particularly attractive to venture capitalists and institutional investors.

Dasbanq's corporate services include access to traditional banking solutions with Zelle and integrations with payment processors like Stripe, providing a solid financial infrastructure to support your growth.

Opening a Business Bank Account with Dasbanq

Accessing the U.S. financial system is essential for international entrepreneurs. Dasbanq facilitates the opening of business bank accounts entirely online, eliminating the need for physical presence. Our partnerships with financial institutions such as Mercury, RelayFi, and First Citizens Bank allow clients to manage their finances with ease.

Our banking services include ACH and SWIFT transfers, online bill payments, and access to Zelle for domestic transactions. Additionally, Dasbanq offers a virtual account with multi-currency support, ensuring seamless cross-border transactions.

How does it work?

Online Application: Complete our digital form with your business details.
Document Verification: Submit your identification, Articles of Organization, EIN, and proof of address.
Account Activation: Access your online banking dashboard within days.

Conclusion: LLC or Corporation?

Choosing between an LLC and a Corporation is a strategic decision that should align with your business objectives and operational plans. LLCs provide simplicity and flexibility, making them ideal for small businesses and international entrepreneurs. Corporations, with their ability to raise capital through stock issuance, are better suited for growth-oriented enterprises.

With Dasbanq, the formation and banking process becomes simple and efficient. Our team of experts ensures compliance with U.S. regulations while offering personalized support throughout every stage.

Start your U.S. business journey with Dasbanq today and access the financial infrastructure necessary for global success.

Visit dasbanq.com for more information.

FAQs

Do I need to be a U.S. citizen to form an LLC?

No, Dasbanq works with international entrepreneurs regardless of citizenship.

How long does it take to form a U.S. LLC and open a bank account?

The process typically takes 3-4 weeks, depending on the state and the accuracy of the provided documentation.

What documents are required to open a business bank account?

We require the Articles of Organization, EIN, Operating Agreement, a valid passport, and a recent utility bill.

Does Dasbanq assist with tax filings?

Yes, we offer accounting services to help prepare and file necessary tax forms, including Form 5472-1120 for single-member LLCs and Form 1065 for multi-member LLCs.

Can I manage my U.S. business from abroad?

Absolutely. Dasbanq provides all the tools and services needed to manage your LLC remotely.