Last updated January 9, 2021

Can a Foreigner Own an S-Corp?

What types of foreigners can own
a U.S. S-Corporation?

The short answer is yes, a “foreigner” can own an S-Corp (also known as an S-Corporation), but it depends on what type of “foreigner”.

If you look on the main S-Corporation page of the IRS website, they briefly state, “To qualify for S-Corporation status, the corporation must meet the following requirements: May not be partnerships, corporations or non-resident alien shareholders.”

This is not very helpful since not all foreigners understand what a non-resident alien is, and the “who can own S-Corp” could be expanded on.

Note: An S-Corporation owner is the same thing as an S-Corporation shareholder.

Who can own an S-Corporation (be an S-Corp shareholder)?

Non-resident alien (aka non-US resident)

A foreigner that is a non-resident alien cannot own an S-Corp.

As per the IRS, a non-resident alien is an individual who is not a US citizen or a US resident alien.

Note: Another word used for non-resident alien is non-US resident.

US resident alien

A foreigner that is a US resident alien can own an S-Corp.

As per the IRS, a US resident alien is an individual that is not a US citizen or US national and who meets either “the green card test” or “the substantial presence test” for each calendar year.

Keep in mind: You will need to maintain your US Resident Alien Status for many years. Meaning, it’s not a one-time requirement to in order to be an S-Corporation owner. You must always be a US Resident Alien in order to keep the S-Corporation in compliance with IRS rules. If you don’t maintain this status, the IRS will not honor your S-Corporation election.

Simplified

The following people can own an S-Corporation:

  • US citizens
  • US residents

The following people can’t own an S-Corporation:

  • non-resident aliens (non-US residents)
Matt Horwitz
Founder & Educator, LLC University®
Forming an LLC shouldn't be so complicated. Our step-by-step guide will make the process a breeze – and no complex legal jargon! LLC University® teaches people how to form an LLC for free in all 50 states. We hope you find our free guides and resources helpful in your business journey.
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