I formed a single-member LLC in Wyoming about two years ago for a small consulting side gig. I'm now relocating to Portugal and will be a tax resident there. The LLC has no employees, no physical office, and just one client. Do I need to dissolve it, or can I keep it running while living overseas? I'm trying to understand what the state requires, what the IRS expects, and whether the bank will cause problems.
LLC
What happens to a US LLC if its owner moves abroad?
You can keep it. Wyoming doesn't care where The owner lives. Just keep the registered agent and annual report paid.
The state side is usually fine. The harder part is banking and tax reporting. If you're a US citizen or green card holder, the LLC itself generally doesn't change, but your personal return includes worldwide income. If you're a nonresident alien after moving, different forms may apply. Foreign tax credits, FEIE, and treaty rules can get complicated. I'd talk to a CPA who handles US expats before assuming it's automatic.
What about the registered agent? Some services won't accept a foreign address for the principal office. Worth checking.
True. A lot of people use a US mailing address or a registered agent service that also provides a business address.
I moved to Germany and kept my single-member LLC. The bank flagged my address change and asked for proof of the new address. They didn't close the account, but it took a few weeks. Make sure your bank allows foreign residential addresses. Some online banks don't.
Also, if the LLC is disregarded for federal tax purposes, the owner's tax residency matters a lot. If yo become a nonresident alien, the LLC may need to file Form 5472 and a pro forma 1120. There are penalties for missing that, so don't ignore it.
Does Portugal treat a US LLC as transparent? I've read that some EU countries don't recognize the check-the-box election and may treat it as a corporation. That could mean different tax treatment locally tbh.
Yes, that's a real issue. Portugal may not follow the US classification. The LLC could be seen as opaque for Portuguese purposes even if it's disregarded in the the US. That mismatch can cause double taxation or extra filing. Definitely need local advice too.
One more thing: some payment processors and clients may not want to pay a US entity if the owner is overseas. Not a legal issue, but practical.
If you keep it, make sure you understand the treaty. The US-Portugal tax treaty has rules about permanent establishment and business profits. If you're performing services from Portugal, Portugal may tax that income regardless of where the LLC is formed.
Could you just dissolve it and start a Portuguese company? If the side gig is small, the US LLC may not be worth the extra compliance.
$50 Wyoming annual report plus registered agent fee is cheap compared to setting up and maintaining a Portuguese company. But the tax and accounting costs could be higher.
Don't forget the BOI reporting. If it applies, a foreign address for the owner may be acceptable, but check the current rules. That requirement has been changing.
I'd start with a CPA who knows expat LLC issues and a Portuguese accountant. The state filing is the easy part. The cross-border tax treatment is where people get surprised.