Wondering how to open a bank account in the United States as a non-US citizen?
Do you know if you’re doing business with customers in the US or earning money in US dollars, having a US bank account can be beneficial in many ways?
Having a US bank account can eliminate many restrictions, certain obstacles, and limited opportunities while doing business online.
If you have US-based partners like Amazon, you probably know that exchange US dollars to your home currency such as GBP, EUR, AUD can be very expensive.
First, let me give you some background.
I make a full-time income online. As a non-US self-publisher who live in a country without any tax treaty with the US, I have to pay the 30% tax for all my royalties earned to Uncle Sam.
To give you a clearer picture, here’s a payment I received from Amazon. As you can see, Amazon straightway deducted a whopping $1,418.96 from my total earnings and the take-home pay was only $3,310.90 for that particular month. Don’t forget I still need to declare and pay tax in my country. That’s a bitter pill to swallow!
* If you’re from Malaysia like me, you probably need to know about double taxation.
Furthermore, I have to pay expensive foreign exchange fees every time I clear the check and convert the US dollars earned into my home currency.
Put simply, having a US bank account makes handling payments easier and faster, especially if you receive payment online.
Depending on what country you live in, incorporating a business in the US will reduce the amount of taxes you have to pay.
But, opening a US bank account as a foreigner can be rather complicated and difficult.
In fact, one of the biggest challenges for most small businesses is actually having a bank account in the US.
The only way you can get around this is by setting up a business entity in the US first and then opening a business US bank account.
And that’s where Stripe Atlas comes in.
With Stripe Atlas, almost anyone from anywhere in the world can incorporate a business in the US and open a US bank account without flying over there physically.
It’s by far the best solution for any startup or entrepreneur who’re looking to expand their business and become a global company.
Depending on your country of residence and tax situation, setting up a US company for your foreign business can be a great idea as you can reduce or avoid US tax in many cases.
No.
You don’t have to travel to the US or visit a physical branch anywhere to set up a US company and establish a bank account.
Even though our company is based in Delaware, US, probably we won’t ever go there for our whole life (except of course, traveling for leisure purposes).
Stripe Atlas is an all-in-one service that helps you to start an internet business from anywhere in the world. They will take care of all the paperwork needed to incorporate in the US, open a US bank account, register with IRS and create a US Stripe account.
Here’s a summary of what you’ll get with Stripe Atlas:
- a US company in Delaware, U.S.A.
- A U.S. Employer Identification Number (EIN) for tax purposes.
- A U.S business bank account with a debit card.
- A Stripe account to receive and make payments globally.
- Join the Stripe Atlas community to connect with like-minded entrepreneurs, experts and founders.
- Access flat-rate packages for legal and tax advice from Orrick and PwC (Optional)
- Access to training, resources and support from Amazon Web Services. Plus, up to $5,000 free AWS promotional credits.
The best part? All this can be done within 1-2 weeks at a very attractive price of only $500.
In short, for a one-time fee of $500, Stripe Altas will help you form a “C-Corporation” company in Delaware and establish a business bank account (complete with a debit card) at Mercury.
Mercury offers free business banking for startups worldwide. Open an account here to get 250 USD when you deposit 10,000 USD in 90 days. Features include no monthly fees, FDIC insurance, international wires, venture debt access, and an API for customization. Ideal for high-growth tech companies.
But you’ll need an invitation to start a company with Stripe. You can use my special invitation link here.
If you’re ready to set up your business + open a U.S. bank account with Stripe Atlas, continue below:
Before we proceed, it’s very important to understand that setting up a business entity in the US comes with significant obligations.
Speaking from my own experience, don’t try to do the tax filling yourself just to save a few hundred bucks. The United States is notoriously known for its highly-complicated tax systems.
Stripe will connect with tax and legal advisors who can help you with accounting, tax filing etc.
However, you can always use any 3rd party CPA or accounting firm that offer high quality and professional services at a better price.
Still can’t decide whether Stripe Atlas is right for you? Check out this comprehensive list of FAQ about starting a U.S. company with Stripe Atlas.
The process of setting up a company and open a US bank is quite straightforward and simple if you’ve all the information needed. Though it might sound terrifying especially for the first timer. And this is what motivates me to write this guide. By writing this I hope that I can help those who have the opportunity to go down the same path.
Having an invitation link lets you skip the queue and get immediate access to the Stripe Atlas Program.
Step 1: Create a Stripe Account
- Click here to access the invitation link to join Stripe Atlas.
- Now you’re on the Stripe Atlas page, click “Get Started” button.
- Next, you’ll need to create a Stripe account, enter your email address and create a password. If you already have an account with Stripe, simply click log in and fill in your current account ID.
- For a new account, you’ll receive an email notification from Stripe. Open the email and click “Confirm email address” to proceed.
Step 2: Fill in the Stripe Atlas application form
This is the most important step in which you have to give all the information about your business as precise as possible. Based on the details given, they’ll determine whether you’re a good fit for Stripe Atlas.
The form consists of 5 parts:
- Product
- Company
- Team
- Bank account
- Payment
- Product: First, you’ll need to provide your website URL and write a brief description of your product and company. Then Click “Save and Continue”.
- Company: If you’re a non-US resident, forming C-Corporation is your only choice here. LLC is only supported for U.S. founders.
- Next, enter the name of your company that you’re going to incorporate, your current physical address and contact number. Follow the default 10,000,000 shares unless you’re seeking advice from a lawyer. After you’ve completed this step, click “Save and continue”.
- Team: You’ll need to inform who are the key people behind the company and their roles. Assign directors, the percentageof ownership, personal information and other details. If you’re working alone, simply allocate 100% of the shares to yourself. If there are two or more founders, then you’ll have to come to an agreement with all your team members.
- Bank account: Select “Yes” if you want to open an SVB bank account. I would recommend using the debit card and wire transfers for ease of transactions.
- Tip: You’ll need to maintain a minimum average balance of $25,000 in your bank account. If not, you’ll be charged a monthly maintenance fee of $25 per month.
- Payment: After ensuring all the information entered is correct, you’ll come to this last step where you need to add your payment details. Don’t worry. You’ll only be charged after your business entity and bank account are successfully opened.
Step 3: Review and Sign the Documents
Once you’ve submitted the application form, you’ll receive an email from Stripe Atlas.
Click on the link in the email to open the document. You might want to take some time to review the document before signing it electronically. All is done online (draw your signature with a finger or a mouse). You don’t have to print it out or send any physical mail.
However, you may want to download and save a PDF file directly to your computer.
Step 4: Incorporation, A US bank account, and EIN tax number
I received an email from Stripe informing that my company has been incorporated in the US about one week later after completing the process as mentioned above.
After a couple of days, I have my new business bank account opened under my company name in Mercury as well as obtaining an EIN number for tax purposes. You don’t have to submit any extra document, Stripe Atlas will help you to register with the IRS.
Your SVB account will be linked to your Stripe automatically. This means that you can use Stripe to process payments to and from your bank account.
The entire process took about two weeks, from incorporation, to open an SVB bank account and register with the IRS.
Step 5: Running a U.S. company
Now, your company is up and running.
Here’s few ongoing fees that you must pay for running a US company:
- $100 per year for maintaining a Delaware registered agent
- $50 annual filing fee for Delaware
- A minimum of $175 annual franchise tax for a Delaware C-Corporation,
- Paying a flat 21% US federal corporate tax rate
The first thing I did after incorporating a US company is upgrading my Amazon KDP account, submit my company’s EIN to completely remove the 30% tax withholding on royalties. Also hired a CPA to take care of the tax filings. If you’re publishing books on Amazon and any major ebook retailers, learn how to avoid the 30% US withholding tax here.
Having a US company also opens an opportunity for you to open a Paypal account in the US. It’d be greatly beneficial for receiving international payments without any restriction.
Setting up a business entity and open a US bank account with Stripe Atlas is a great learning experience. I’m still learning and figuring out how to reduce tax as well as grow my company.
Tip: To save money on your annual tax bill, you might want to incorporate your company at the beginning of the year rather than the end of the year.
For instance, we submitted all the documents and have our company incorporated in December. We have to pay $400 in tax for the year even though our company existed for less than a month. If we waited one more month, we could have avoided paying the tax.
Undoubtedly, Stripe Atlas is a good solution for non-U.S. entrepreneurs who are looking to open a U.S. bank account and expand their business without physically being in the U.S.
It’s especially helpful for normal people like you and me with little or no experience about legal, finance and tax issues. With all the supportand guidance provided, it lets you focus on building awesome products or services for your audience.
What do you think?
Do you know any country offers tax benefits for online entrepreneurs and digital nomads?
Do share with us in the comment below.
Read more:
- How to Start a Business with just $50
- Elon Musk’s Advice for Starting a Business
- How to Avoid the 30% US tax withholding for Non-US Self-Publishers
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I live and breath making an income online.
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