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Doing Business in the United States

If you're thinking about expanding your business or starting a new venture, the United States is the place to be. With its strong economy, diverse consumer base, and business-friendly environment, the US offers unrivaled opportunities for growth and success.

From the vibrant streets of New York City to the thriving tech hubs of Silicon Valley, this vast country is a hub of innovation and entrepreneurship. Not only does the US have a highly skilled workforce and top-notch infrastructure, but it also has a robust legal system that protects businesses and encourages healthy competition. Additionally, the US market is renowned for its openness to new ideas and products, making it the perfect testing ground for innovative offerings.

In this article, we will explore the various tax and industry factors to provide you with a comprehensive understanding that will assist you in making informed investment decisions.


Disclaimer: The information provided is current as of the date of publication. This is an informational article only and does not replace the advice of an attorney or financial advisor.


Why U.S.

According to the U.S. Census Bureau Population Clock, the population of the United States is estimated to be approximately 336,022,922.

Among its main aspects are:

  • The USA is the third-largest country in the world, spanning diverse landscapes from frozen Arctic tundra to subtropical deserts, towering mountains to sprawling plains.
  • Highly diverse population due to historical immigration, with major ethnic groups like African Americans, Asian Americans, Indigenous Americans, and Latin Americans.
  • It depends mainly on private enterprises and free markets, through existing government regulations.



The importance of business structures in the United States

Business structures play a vital role in the United States, profoundly impacting the economic landscape and individual journeys of entrepreneurship.

Each structure comes with distinct tax implications. Sole proprietors report business income on their personal tax returns. Corporations and LLCs can elect different tax statuses, impacting how profits are distributed and taxes are paid.

Formal structures like corporations project a professional image and instill trust in customers, partners, and investors. This can be crucial for attracting business and establishing a brand reputation.

Different structures offer different tax benefits. For example, S corporations can avoid double taxation, while C corporations may benefit from lower tax rates on reinvested profits.

Partnerships are suitable for businesses with a small number of trusted owners who value shared control and expertise. Carefully consider the type of partnership and its implications before forming one.



Most noteworthy industries

1. Technology - Leading the way in innovation, the tech industry includes behemoths such as Apple, Google, Microsoft, and Amazon. It drives economic growth, generates employment opportunities, and profoundly influences our daily lives, professional endeavors, and interpersonal connections.

2. Healthcare - This vast sector includes hospitals, pharmaceutical companies, medical device manufacturers, and insurance providers. It employs millions and ensures access to medical care for a large population.

3. Finance - Wall Street, a global financial hub, houses major banks, investment firms, and insurance companies. This industry manages financial assets, facilitates investments, and drives economic activity.

4. Retail - This ever-evolving industry caters to consumer needs, encompassing online giants like Amazon and brick-and-mortar stores like Walmart. It employs millions and contributes significantly to the economy. 



Limitations for foreign investors

Foreign investors are subject to certain rules and regulations when investing in the United States. These laws may differ based on the federal and state governments and may change from year to year. The limitations may affect the mode of investment, such as property or money transfers, and the size of the investment.

For more information, consult your lawyer or a financial advisor to evaluate the best course of action for your specific case.


Main Tax Rates

Corporate taxes 21% rate for tax years beginning after 31 December 2017.
Dividends The general withholding rate for dividends paid to non-resident aliens is 30%. However, this rate can be reduced or eliminated depending on some cases.
Employment Tax

Federal income tax (FIT) on wages.
Social Security Tax (SS), employers and employees contribute to Social Security, which provides retirement and disability benefits. The current combined tax rate is 12.4%.
Medicare Tax (Med) is 2.9%.
Federal Unemployment Tax (FUTA) has a tax rate is 6%.

Sales Tax Most states have a sales tax, with rates ranging from 0% to over 10%.


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How we can help you

Our CPAs have experience in the taxation of entities in the United States. Our Entity Management service has a range of solutions in incorporation, document retrieval, and global Directors.

To learn more about our accounting firm services take a look at our individual tax servicesbusiness tax servicesinternational tax servicesexpatriate tax servicesSAP Business One, human capital, and audit and assurance services.  

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