Form 5472 Filing Guide: Instructions, Deadlines & Penalties (2026)

Form 5472 Filing Guide for Foreign-Owned LLCs

Don't Skip This Form

The IRS charges $25,000 for every missed Form 5472, and there's no statute of limitations.

If a foreign person owns 100% of a U.S. single-member LLC or at least 25% of a U.S. corporation, Form 5472 is generally required when there are reportable transactions, even if the business has no income.

The problem? Most foreign LLC owners don't know Form 5472 exists until after they've missed the deadline.

In this guide, we'll walk through exactly who needs to file Form 5472, what triggers the requirement, how to complete it correctly, and what to do if you're already behind.

What Is IRS Form 5472?

Form 5472, officially titled Information Return of a 25% Foreign-Owned U.S. Corporation or a Foreign Corporation Engaged in a U.S. Trade or Business, is one of the most consequential international information returns the IRS requires.

Governed by IRC §6038A and §6038C, this form reports transactions between U.S. entities and their foreign owners or related parties. It's an information return. It doesn't generate tax liability on its own, but failing to file it triggers some of the harshest penalties in the entire tax code.

Who Must File Form 5472?

Form 5472 is required for two categories of filers:

1. A 25% foreign-owned U.S. corporation that has reportable transactions with a foreign or domestic related party during the tax year.

2. A foreign corporation engaged in a U.S. trade or business that has reportable transactions with a related party.

The 25% ownership threshold is broader than most people expect. You're considered a "25% foreign shareholder" if you own (directly or indirectly) at least 25% of the total voting power or total value of a U.S. corporation's stock. This includes ownership attributed through family members, partnerships, estates, trusts, and related corporations under IRC §§267(b) and 707(b)(1).

In practical terms, if any of these describe you, Form 5472 is likely required:

• You're a foreign individual who owns 25% or more of a U.S. corporation
• You're a foreign entity (corporation, partnership, trust) that owns 25% or more of a U.S. corporation
• You're a foreign individual who is the sole owner of a U.S. single-member LLC
• Your U.S. corporation has transactions with any foreign related party

A separate Form 5472 must be filed for each related party with whom the reporting corporation had reportable transactions during the year. If your LLC has transactions with three related foreign entities, that's three Forms 5472.

Read our complete Foreign-Owned LLC Reporting and Taxes Guide for the full picture on LLC compliance.

The 2017 Rule Change That Caught Thousands Off Guard

Before 2017, single-member foreign-owned LLCs classified as "disregarded entities" for tax purposes had almost no filing obligations with the IRS. They didn't file income tax returns. They didn't file information returns. From the IRS's perspective, they were invisible.

That changed with Treasury Regulation §1.6038A-1(c), which became effective for tax years beginning on or after January 1, 2017. Under these final regulations, a foreign-owned U.S. disregarded entity is now treated as a corporation separate from its owner, but only for purposes of the Form 5472 reporting requirements under IRC §6038A.

This means that even if your LLC:

• Has no U.S.-source income
• Conducts no business in the United States
• Is completely dormant

...you still must file Form 5472 every year, attached to a pro forma Form 1120, if you had any reportable transactions with a related party. And as we'll explain below, even a simple capital contribution counts.

This single regulatory change swept thousands of foreign-owned LLCs into the IRS reporting system overnight. Many owners of Amazon seller LLCs, U.S. real estate holding LLCs, and e-commerce entities formed by non-residents discovered Form 5472 only after receiving penalty notices.

What Are Reportable Transactions on Form 5472?

A "reportable transaction" is any exchange, whether monetary or non-monetary, between the reporting corporation (your LLC or U.S. corp) and a foreign related party. The IRS casts an intentionally wide net here.

Monetary transactions (Part IV) include any transaction involving monetary consideration: sales and purchases of tangible property, rents and royalties, interest on loans, service fees (management, consulting, technical services), commissions, loan principal amounts, and insurance premiums paid to a related foreign insurer.

Transactions specific to disregarded entities (Part V) are where most foreign LLC owners get caught. Part V captures:

• Capital contributions, including the initial funding of the LLC
• Distributions from the LLC to the foreign owner
• Amounts related to formation, dissolution, acquisition, or disposition of the entity

This is the trap most foreign LLC owners fall into. Even if your LLC has zero revenue and zero expenses, the act of funding your LLC's bank account is a capital contribution, and that's a reportable transaction requiring Form 5472.

Example: Maria, a German entrepreneur, forms a single-member LLC in Wyoming to sell digital products. She transfers $5,000 from her German bank account to the LLC's U.S. bank account to cover formation costs. That $5,000 transfer is a reportable transaction. Maria must file Form 5472 and a pro forma Form 1120, even if the LLC never makes a sale.

Non-monetary transactions (Part VI) cover exchanges where no cash changes hands but something of value is transferred: use of property without full consideration, services provided without compensation, and property exchanges.

Who Is a "Related Party" for Form 5472?

For most foreign-owned LLCs, the related party is the foreign owner themselves. But the definition extends further under IRC §482:

• The foreign owner and their family members (spouse, children, parents, siblings under IRC §267(b))
• Any entity controlled by the foreign owner (other companies, partnerships, trusts)
• Any person or entity related to a 25% foreign shareholder

There is no de minimis threshold. A $100 capital contribution triggers the same filing obligation as a $10 million one.

The Pro Forma Form 1120 Requirement

Here's where things get unintuitive. Even though a single-member foreign-owned LLC is a "disregarded entity" for income tax purposes (meaning it doesn't normally file a corporate tax return), it must file a pro forma Form 1120 as a cover sheet for its Form 5472.

The pro forma Form 1120 is not a real corporate tax return. It requires minimal information:

• The name and address of the foreign-owned U.S. disregarded entity
• Items B (employer identification number) and E (date incorporated) on the first page
• Write "Foreign-Owned U.S. DE" across the top of the form

That's it. No income, no deductions, no balance sheet. The pro forma 1120 exists solely as a vehicle to carry the Form 5472 to the IRS.

Your LLC must have its own EIN. Even if your LLC has no employees, no U.S. income, and no obligation to file any other federal return, you need an Employer Identification Number to file the pro forma 1120 and Form 5472. You can apply for an EIN using Form SS-4.

How to File Form 5472: Step by Step

Step 1: Obtain an EIN. If your foreign-owned LLC doesn't already have an EIN, apply using Form SS-4. Foreign applicants can apply by phone (267-941-1099, not a toll-free number), by fax, or by mail. The online EIN application is only available to persons with a valid U.S. Taxpayer Identification Number (SSN or ITIN).

Step 2: Complete Form 5472. The form has eight parts. For a typical single-member foreign-owned LLC, you'll complete:

• Part I: Information about the reporting corporation (your LLC). Use the EIN, not the owner's personal tax ID.
• Part II: Information about the 25% foreign shareholder. Include the foreign owner's name, address, country of citizenship, country of organization, and foreign taxpayer identification number (FTIN).
• Part III: Related party information (often the same as Part II for single-member LLCs).
• Part V: Transactions of a foreign-owned U.S. disregarded entity. Report capital contributions, distributions, and any amounts related to formation, dissolution, or acquisition.

If your LLC also has monetary transactions with the foreign owner or another related party (rent, interest, service fees), you'll also complete Part IV.

Step 3: Prepare the pro forma Form 1120. Complete only the header information as described above. Write "Foreign-Owned U.S. DE" across the top.

Step 4: File by paper. Foreign-owned disregarded entities cannot e-file. You must file by paper mail or fax:

Mail to:
Internal Revenue Service
1973 Rulon White Blvd
M/S 6112, Attn: PIN Unit
Ogden, UT 84201

Or fax to: 855-887-7737

Attach Form 5472 to the pro forma Form 1120. If you have multiple Forms 5472 (multiple related parties), attach all of them to a single pro forma 1120.

Form 5472 Filing Deadlines and Extensions

Form 5472 is due on the same date as the reporting corporation's income tax return:

• For disregarded entities (LLCs): April 15 following the close of the tax year (assuming a calendar year)
• For U.S. corporations: The due date of Form 1120 (April 15, or the 15th day of the 4th month after the fiscal year ends)

You can request an automatic 6-month extension by filing Form 7004 before the original due date. On Form 7004, enter the code for Form 1120 in Part I, Line 1 and write "Foreign-Owned U.S. DE" across the top. This extends your deadline to October 15 for calendar-year filers.

Important: The extension extends the filing deadline, but it does not extend the deadline for maintaining records. You must have all records available from day one.

Form 5472 Penalties: What You Risk for Non-Compliance

The penalty structure for Form 5472 is among the harshest in the Internal Revenue Code, and it's intentionally designed that way.

Under IRC §6038A(d), the IRS imposes a $25,000 penalty for each failure to file Form 5472 when required, file it on time, file a substantially complete form (a form with missing or incorrect information is treated as not filed), or maintain required records under IRC §6038A(a).

If you still haven't filed after the IRS sends you a notice of failure, an additional $25,000 penalty accrues for each 30-day period (or fraction thereof) that passes after the 90-day window following the notice. There is no statutory cap on continuation penalties.

Under IRC §6501(c)(8), the statute of limitations on assessment does not begin to run until the required information is furnished to the IRS. If you never file Form 5472, the IRS can assess penalties, and any related tax, at any point in the future. There is no "running out the clock." In addition, willful failure to file can trigger criminal penalties under IRC §§7203, 7206, and 7207, including fines and imprisonment.

How penalties stack: Because a separate Form 5472 is required for each related party, penalties multiply. If your LLC has three related parties and you miss one filing year, you could face $75,000 in penalties ($25,000 × 3 forms), before continuation penalties even begin.

Filing Form 5472 correctly and on time is almost always cheaper than the penalty for not filing. Even hiring a CPA to prepare the form costs a fraction of a single $25,000 penalty.

➔ Don't risk a $25,000 penalty. Schedule a call

The Farhy Case: Can the IRS Actually Collect Form 5472 Penalties?

A significant legal question has emerged around whether the IRS even has the authority to assess penalties for international information returns like Form 5472.

In Farhy v. Commissioner (April 2023), the U.S. Tax Court held that the IRS lacked statutory authority to assess penalties under IRC §6038(b) for failure to file Form 5471. The reasoning: Congress only authorized the IRS to assess penalties found in Subchapter B of Chapter 68 (IRC §§6671-6725), and the international information return penalties fall outside that range.

Tax practitioners quickly recognized that the same logic could apply to Form 5472 penalties under IRC §6038A(d).

Then things got complicated. In May 2024, the D.C. Circuit Court of Appeals reversed the Tax Court's Farhy decision, finding that the IRS does have assessment authority. But in November 2024, the Tax Court pushed back, deciding en banc (15-1) in Mukhi v. Commissioner that it would decline to follow the D.C. Circuit's reversal, reaffirming its original position.

The legal landscape is unsettled. While the Tax Court's position is favorable for taxpayers, the IRS continues to assess Form 5472 penalties and will likely continue to do so unless Congress or the Supreme Court resolves the split. Do not treat Farhy as a reason to skip filing. The IRS is still issuing penalty notices, and the cost of defending against them, even if you ultimately win, far exceeds the cost of filing correctly.

Common Form 5472 Filing Mistakes That Trigger Penalties

After years of preparing Form 5472 for foreign-owned LLC clients, here are the errors we see most often:

Not filing at all. The single most common mistake. Foreign entrepreneurs form a U.S. LLC through a registered agent, open a bank account, and have no idea that Form 5472 exists. This is especially common for e-commerce sellers (Amazon, Shopify) who formed a U.S. LLC for payment processing, foreign real estate investors holding U.S. property through an LLC, and SaaS founders who incorporated in Wyoming or Delaware for credibility.

Thinking "no income" means "no filing." Wrong. If you funded your LLC with a capital contribution, even $100 to open a bank account, that's a reportable transaction. No income does not mean no filing requirement.

Filing a substantially incomplete form. The IRS treats a form with missing or incorrect information the same as a form that was never filed. Common gaps include:

• Missing FTIN: You must provide your home country's taxpayer identification number in Part II. The One Big Beautiful Bill Act (2025) strengthened FTIN requirements for all foreign owners of U.S. entities.
• Incomplete Part IV or Part V: Leaving transaction amounts blank or entering "$0" when there were actual transactions.
• Wrong EIN: Using the owner's personal ITIN instead of the LLC's EIN.

Trying to e-file. Foreign-owned disregarded entities cannot e-file Form 5472. If you attempt to submit electronically through tax software, it will be rejected. Many owners waste time troubleshooting a "software error" that's actually a regulatory restriction.

Missing the extension deadline. Filing Form 7004 for an extension is simple, but many foreign owners don't realize they need to use the Form 1120 code (not a partnership or individual code) on the extension request, with "Foreign-Owned U.S. DE" written across the top.

Not filing separate forms for each related party. If your LLC transacts with both you (the foreign owner) and a company you control, that's two related parties and two Forms 5472, both attached to a single pro forma 1120.

Form 5472 Record-Keeping Requirements

Under IRC §6038A(a) and Treasury Regulation §1.6038A-3, reporting corporations must maintain permanent books of account and records sufficient to establish the correctness of the federal income tax return, document all transactions with related parties, and support any transfer pricing positions.

Records must be kept for as long as they may be relevant, which, given the open-ended statute of limitations on unfiled Forms 5472, effectively means indefinitely until the form is filed and the statute begins to run.

Required records include:

• Bank statements showing all transfers between the LLC and foreign owners or related parties
• Loan agreements, promissory notes, and interest calculations
• Invoices for services, rent, royalties, or other payments
• Entity formation documents
• Operating agreements and amendments
• Documentation of the LLC's ownership structure and any changes

Form 5472 vs. Form 5471: Which Do You Need?

These two forms are often confused, but they serve opposite purposes.

The quick test: If you're a foreign person who owns a U.S. LLC or corporation, you likely need Form 5472. If you're a U.S. citizen or resident who owns a foreign corporation, you likely need Form 5471. In some cases (such as a U.S. corporation owned by a foreign parent that also owns foreign subsidiaries) both forms may be required.

2026 Regulatory Changes Affecting Form 5472 Filers

Several developments make 2026 a particularly important year for Form 5472 compliance.

The One Big Beautiful Bill Act (signed July 2025) introduced enhanced FTIN requirements: foreign owners must now provide their foreign taxpayer identification number on all information returns, including Form 5472. Failure to provide an FTIN may result in the form being treated as incomplete. The law also created a 1% remittance tax on certain cross-border transfers from U.S. entities to foreign related parties, which may create additional reporting and compliance obligations for foreign-owned LLCs.

FinCEN Beneficial Ownership Information (BOI) Reporting: In March 2025, FinCEN removed BOI reporting requirements for domestic companies, but foreign-owned companies registered in the U.S. must still file. The deadline for pre-existing foreign reporting companies was April 25, 2025. This means foreign-owned LLCs now have two parallel filing obligations: Form 5472 + pro forma 1120 (to the IRS), and a FinCEN BOI report (to FinCEN). These are separate filings to separate agencies, with different deadlines and different penalties.

Increased IRS enforcement: The IRS has publicly stated that international compliance is a top enforcement priority. Enhanced data sharing between countries under FATCA and the Common Reporting Standard (CRS) means the IRS has more information than ever about foreign ownership of U.S. entities. The era of flying under the radar is over.

Learn more about FBAR Filing Deadlines & Requirements and Foreign Tax Credits for US Expats.

What to Do If You're Behind on Form 5472 Filing

If you've owned a foreign-owned LLC for multiple years and never filed Form 5472, don't panic, but do act quickly.

1. File delinquent returns immediately. Attach a reasonable cause statement explaining why the forms were late. Common reasonable cause arguments include reliance on a tax professional who failed to advise you, lack of knowledge of the requirement (stronger for newly imposed requirements), and circumstances beyond your control.

2. Explore the IRS Streamlined Filing Compliance Procedures. If you can certify that your failure was non-willful, the Streamlined Foreign Offshore Procedures may provide penalty relief. This program requires filing 3 years of delinquent returns and 6 years of FBARs.

3. Consult a CPA before filing. The reasonable cause statement is your primary defense against penalties. How it's written matters. A well-crafted statement that demonstrates ordinary business care and prudence, supported by documentation, significantly improves your chances of penalty abatement.

Check out our Ultimate Guide to Taxes for Expats for a broader look at international filing requirements.

FAQs About Form 5472 Filing Requirements

Form 5472

Form 5472 is not optional, and it's not something to put off. The $25,000 penalty per form, with no statute of limitations, makes it one of the most punitive information returns in the Internal Revenue Code.

If you own a U.S. LLC or corporation with foreign ownership, make sure you:

• Have an EIN for the entity
• Track every transaction between the entity and any foreign related party
• File Form 5472 with a pro forma Form 1120 by April 15 (or October 15 with an extension)
• Keep records indefinitely until the form is filed and the statute begins to run

The good news: once you have a system in place, annual filing is straightforward. The cost of compliance is minimal. The cost of non-compliance is not.

Need Help Filing Form 5472?

Our international tax team prepares Form 5472 for foreign-owned LLCs across every state. Whether you're filing for the first time, catching up on missed years, or dealing with an IRS penalty notice, we can help.

Schedule a call with Hiltzik CPA today and get personalized guidance on your Form 5472 filing requirements.