How To Register And Start A Company In The USA From Cuba? (2024) LLC & C-Corp

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Embarking on the process of registering and launching a company in the USA from Cuba may seem difficult and complex. We recognize the hurdles ahead and are here to support you every step of the way.

This guide is your trusted companion, carefully crafted for Cuban entrepreneurs ready to explore the process of registering and launching a company in the USA from Cuba. Together, we’ll delve into the complexities of legal, financial, and operational aspects, laying the groundwork for your triumph.

Register and Start your business in the USA

Step 1: Choose between LLC and C-Corp

For individuals or enterprises from Cuba looking to register a company in the U.S., deciding between an LLC (Limited Liability Company) and a C-Corp (C-Corporation) is an important step. Each entity type brings unique characteristics, strengths, and limitations, suiting different business scenarios and goals.

Register LLC in the USA from Cuba:

1. Taxation: For foreign-owned LLCs in the U.S., pass-through taxation is usually not an option. A viable solution is to register the LLC for corporate taxation and then bill it (either personally, through your local business in Argentina, or via a lower tax jurisdiction) for management fees to negate profits and thus U.S. tax obligations.
2. Ownership: There are no ownership limitations in a U.S. LLC. Members can be non-U.S. citizens, non-resident aliens, or any company, domestic or international, making it an adaptable option for entrepreneurs.
3. Management: LLCs provide a flexible management framework, enabling owners from Cuba to define their roles and operations without rigid structures. Designed as a limited liability Sole Proprietorship or Partnership, an LLC’s management and ownership are streamlined, ensuring less complexity and direct control.
4. Compliance: Generally, LLCs face fewer compliance demands and formalities, reducing legal and accounting costs. This is especially advantageous for smaller businesses, where resources for extensive record-keeping and frequent reporting may be limited.

Register C-Corp in the USA from Cuba:

While LLCs present numerous advantages, certain conditions may make a C-Corp more suitable:

1. Raising Capital: Businesses focused on attracting venture capital or pursuing a public listing might find C-Corps to be more appealing. C-Corps can issue various types of stocks, which can attract investors interested in equity.
2. Desire for Structure: Enterprises desiring a more formal structure, complete with a board of directors and specific officer roles, might opt for a C-Corp. This can add legitimacy and establish a defined hierarchy in larger companies.
3. Employee Benefits: For companies planning extensive benefits for a large workforce, C-Corps are well-suited. They excel in handling diverse benefits, key for companies aiming to attract and retain top talent, such as:

– Stock Options: C-Corps enable employees to buy shares in the company at a set price, aligning them with the company’s progress.
– Tax Advantages: C-Corps can leverage tax benefits related to employee benefits, like deducting the cost of these benefits, providing financial benefits to both the company and its employees.

In conclusion, while LLCs are often the go-to for entrepreneurs from Cuba due to tax, ownership, and compliance advantages, C-Corps are instrumental for capital raising and structured growth. Deciding between an LLC and a C-Corp in the U.S. requires careful consideration.

Step 2: Pick a Name and a Corporate Ending

Considerations for Naming Your Business:

1. Choose a unique business name: The chosen name should be distinct and not in use in the registration state. The state’s Secretary of State website can be used to check name availability.
2. Check for name availability: Task your registered agent, who needs a physical address in the state of registration, with verifying the availability of your chosen name.
3. Consider the type of business entity: The type of your business entity, whether it’s a C-Corporation, LLC, or S-Corporation, will affect your company’s name. For instance, S-Corporations have specific ownership criteria that might not align with every business model.
4. Comply with state regulations: Every state has its own set of regulations for business names. Ensure compliance with these, including necessary reservations, filings, and any state-specific formalities.

Step 3: Select Your Registration State

The decision of where to register your business is pivotal, affecting your tax liabilities, legal obligations, and day-to-day operations. Among the leading choices is Delaware, known for its favorable business climate. Additionally, states such as Wyoming and Nevada are also popular due to their business-friendly environments and should be evaluated as potential options.
StateAdvantagesDisadvantages
DelawareFavorable Tax EnvironmentFranchise tax may lead to slightly higher costs for businesses
No state corporate income tax for out-of-state business
No State Sales Tax
Ease of Business Formation
Flexible Business Structures
WyomingNo corporate or personal income taxLess recognized compared to other states
Cheaper franchise taxes
NevadaNo state corporate income taxHigher annual reporting fees
Mandatory state tax return filing
Public listing of all officers and directors

Step 4: Choose A Registered Agent For Legal Compliance

Choosing a registered agent for your business in the USA is a decision of great significance. This agent will be tasked with receiving all legal and official communications for your company, so it’s vital to pick someone reliable.

Considerations for Selection:

1. Physical Address: Ensure the agent has a physical address (not a P.O. box) in your business’s state of registration.
2. Availability: They must be present to receive documents during normal working hours.
3. Compliance Expertise: Your agent should have a thorough understanding of the state-specific compliance requirements.
4. National Presence: If your business is or will be operating in multiple states, a registered agent with a national presence is advisable.
5. Reputation: Choose an agent with a solid reputation for providing dependable services.
6. Additional Services: Look for agents offering extra services such as business formation assistance and paperwork filing.
7. Fees: Pay attention to their fee model, ensuring it’s straightforward and devoid of hidden fees.

Step 5: Provide details for the Owner, Director, and Manager (Who May Be A Single Individual)

You must provide the following:

– A passport
– Address

Step 6: Get A US Office (Virtual Or ExecutiveCenter)

A virtual office allows you to register your business with a premium address while saving on the expense of a physical office.

When registering a company in the USA from Cuba, you have the option to obtain a virtual office, which can provide a professional business address and other services.

Want Help Setting Up Your Serviced Office?

With our registered agent services, we also offer serviced offices.

Step 7: Get an EIN From the IRS

Acquiring a Federal Employer Identification Number is a vital step in establishing your business’s legitimacy in the United States. The IRS issues this nine-digit number for tax and various business purposes.

To apply for an EIN from outside the US for your company, consider these options:

1. Apply for an EIN: Following your company’s incorporation, you can apply for an EIN through the IRS. This nine-digit number is crucial for your business’s tax identification.
2. Use a Registered Agent: During your company’s registration, a registered agent can aid in the EIN application process. Registered agents are responsible for managing legal and official documentation and may assist with EIN applications.

Once you have your EIN, the subsequent step is to ensure your company is registered with FinCEN BOI, adhering to current legislation and guidelines.

Register the company and beneficial owners with FinCEN BOI

Compliance with the Financial Crimes Enforcement Network’s (FinCEN) Beneficial Ownership Information (BOI) reporting rules is a critical step when registering a company in the USA. These regulations, integral to the Corporate Transparency Act, necessitate that reporting companies furnish specifics about their ultimate owners or controllers.

Essentials for FinCEN BOI Registration

Reporting Deadlines and Requirements

– Companies created or registered for business before January 1, 2024, have until January 1, 2025, to file their first BOI report.
– Existing companies have one year to file, while new ones must do so within 90 days of creation or registration.
– Companies must provide four pieces of information about each beneficial owner: name, birthdate, address, and passport number.

Reporting Process and Frequency

– Companies should have processes in place for collecting, reporting, and safeguarding BOI data for FinCEN.
– Reporting is not an annual task; you only need to submit a report once, unless you need to update or correct information.
– FinCEN started accepting reports on January 1, 2024.

Compliance and Fraud Protection

– Be vigilant about potential fraud. FinCEN never sends unsolicited requests, so don’t respond to fraudulent messages or click on any links in them.

Step 8: Open a US Bank Account Remotely

After successfully forming your company, the next critical step is opening a US bank account.

Documents needed for opening a US bank account:

Required documentsDescription
Director’s IdentificationValid photo ID, such as a passport and driver’s license, or tax card with a photo.
Director’s Address ProofProof of the director’s residential address, e.g., utility bills or bank statements.
Incorporation/Organization PapersArticles detailing the company’s structure, management, and membership.
EIN ConfirmationVerification letter issued by the Internal Revenue Service (IRS) for taxation purposes.
Business Location VerificationEvidence confirming that the business address is located in the United States.
Company DocumentsMay include the company’s certificate of incorporation, articles of organization, or other relevant documents.
We have partnerships with four major US banks, streamlining the process of opening an account to under 5 days, which is notably quicker than the average period. Learn more on this service by visiting our page, or schedule a free consultation with us for further assistance.

Step 9: Open A Merchant Account To Accept Credit Cards

When registering a company in the USA from Cuba, opening a merchant account to accept credit card payments is a crucial step. A merchant account is a business account that allows the acceptance and processing of credit card transactions.

Requirements for opening a Merchant Account:

– Completing a detailed application with relevant business information (i.e. Business license, proof of business bank account, and EIN)
– Business and personal credit history
– Certificate of incorporation
– Articles/memorandum of association
– Shareholder registry

In addition to business details, you might be required to provide personal information about yourself as a business owner. This includes:

– Your full name
– Your residential address
– Your ITIN (optional)

This is necessary because the merchant account provider conducts a credit check as a standard component of the underwriting process. Not all providers require a credit check anymore.

Step 10: Transfer Profits Home Or To A Lower Tax Jurisdiction

When establishing a business in the US from Cuba, it’s vital to grasp regulations about bringing profits back and transferring them to places with lower taxes. Here are key points to consider:

Getting Your Money from Cuba:

1. Cuban Regulations: To receive money from Cuba, individuals must ensure that the remittance transactions are authorized under 31 CFR § 515.570 of the Cuban Assets Control Regulations (CACR).
2. Methods for Transferring Funds from Cuba: For transferring funds from Cuba, individuals subject to U.S. jurisdiction can provide financial services to Cuban nationals located outside of Cuba, as long as the transaction does not involve a commercial exportation of goods or services to or from Cuba. Banking institutions are authorized to open and maintain accounts solely in the name of a Cuban national located in Cuba for authorized transactions.
3. Taxation: The amount of remittances allowed can vary. It’s also important to note that remittances to Cuban nationals by any person subject to U.S. jurisdiction are authorized.

Transferring Profits to a Lower Tax Jurisdiction

1. Evaluating Tax Impacts: It’s crucial to consider the tax ramifications in both the country from where the profits are transferred and the destination country. Jurisdictions such as the Bahamas, Bermuda, and the Cayman Islands are frequently selected due to their absence of corporate taxes.
2. US Tax Framework: Familiarize yourself with the nuances of the US tax system, especially how it may encourage transferring profits to low-tax jurisdictions, in alignment with international tax regulations and treaties.

Limitations and Regulations

1. Repatriation Limits: Sending money from Cuba to the U.S. is subject to strict regulations. The repatriation limits vary depending on the purpose of the transfer and the individual’s circumstances. Generally, individuals can send up to USD 1,000 every three months to family members in the U.S. for personal support or humanitarian reasons. However, it’s essential to check the latest regulations with Cuban authorities or financial institutions before making any transfers.
2. Tax Implications: Depending on the nature of the transfer and the amount sent, individuals may be subject to taxes or reporting requirements in both countries.

Setting Up Transfers

Payment Methods: Sending money from the U.S. to Cuba involves navigating through specific channels due to trade and economic sanctions. One common method is through authorized money transfer services or remittance providers. These companies facilitate transfers to Cuba in compliance with U.S. regulations. Additionally, individuals can explore options such as bank transfers or international wire services, although they must ensure compliance with relevant regulations and restrictions.

Step 11: Get an ITIN from IRS for Banking and Credit (optional step)

The IRS provides an ITIN, or Individual Taxpayer Identification Number, for those who need a US taxpayer identification but cannot obtain a Social Security number. For entrepreneurs from Cuba setting up a business in the U.S., securing an ITIN can facilitate more efficient banking processes and aid in building a credit profile for both the business owner and the company.

It’s important to note, though, that obtaining an ITIN is not mandatory for starting a business in the U.S.

What are the Costs and Registration Fees for Incorporating a Company in the USA?

The choice of state for incorporating a company in the USA often depends on several factors, including costs, regulatory environment, and specific advantages offered to businesses.

Here’s a breakdown of the different taxes imposed by the top 5 states:

StateCost to IncorporateAnnual Franchise Tax
Delaware$90$225
Wyoming$100$60
New Mexico$50$0
Nevada$75$0
California$70$800

Requirements to Register a Company in the USA for Cuban Citizens

These are the critical initial steps you must take when registering a company in the United States. Remember, they’re extremely important and should be your top priority.

– Directors must be at least 18 years old (or have a parent representative) and have valid passports.

Frequently Asked Questions

Do I need to travel to the US for Company Registration?

You do not need to travel to the US for company registration. The process of registering a company in the US has shifted entirely online. The physical presence of any of the business stakeholders is not required. Instead, you can submit the necessary scanned and self-attested documents for registration via a portal.

What is a Certificate of Authentication and when is it required?

A Certificate of Authentication is an optional document that may be necessary for specific business activities, like opening a bank account in Cuba or providing proof of a US company. It’s not a mandatory requirement for registering a company in the USA from Cuba.

How can I obtain an Apostille for my US documents?

Getting an Apostille, a special form of validation acknowledged worldwide through the Hague Convention, is essential for many reasons. You have multiple options to obtain it, such as applying through your Registered Agent, the Secretary of State’s office, or other designated entities like U.S. federal court clerks or the U.S. Department of State Office of Authentications.

This process becomes invaluable when you’re looking to set up a bank account in Cuba or provide evidence of your U.S. company.

What should I do to authenticate Cuban documents for use in the United States?

The steps to authenticate Cuban documents for use in the United States include notarization by a Cuban notary public, certification by the Cuban Ministry of Foreign Affairs, and then legalization by the U.S. Embassy in Havana.

Is the Certificate of Authentication always necessary?

No, the Certificate of Authentication is not always necessary. It’s important to consider your specific business needs to determine if this step is essential for your circumstances.

Final Steps to U.S. Business Success for Cuban Entrepreneurs

Starting a company in the USA from Cuba is a comprehensive endeavor. Our 2024 guide lays out a complete framework, covering crucial aspects from selecting the most suitable business structure to establishing bank accounts.

Cuban entrepreneurs can smoothly navigate this path with strategic planning and the assistance of an adept registered agent, who can facilitate the legal procedures and state registration process.

Feel free to get in touch with us for a free, no-obligation consultation. We’re here to clarify any doubts about the above information and guide you through a rapid registration process.

Book Your 30 Minute Free Consultation.

Get Free & Instant advice on registering your business in Delaware & the USA.