Taiwanese Company Expanding to the U.S.: LLC vs C-Corp, E-2 Visa and Tax Setup, Step by Step

Taiwan is an E-2 treaty country. A Taiwanese investor can apply for an E-2 visa if the U.S. enterprise is, as a rule, at least 50 percent Taiwanese-owned and the investment is substantial; there is no fixed minimum. Most companies form an LLC or C-Corp, get an EIN, appoint a registered agent and set up taxes before leasing or hiring.

Can a Taiwanese company apply for an E-2 visa?

Yes. The U.S. Department of State's treaty country list includes "China (Taiwan)" under both E-1 and E-2, with a footnote explaining that this agreement, concluded before 1979, is administered on a nongovernmental basis by the American Institute in Taiwan. The State Department's treaty investor rules set out the main E-2 requirements:

• The applicant must be a national of the treaty country, and the U.S. enterprise must also have that nationality, which means that, as a rule, it is at least 50 percent owned by Taiwan nationals.
• The investment must be substantial and sufficient to support the successful operation of the enterprise; funds merely held in a bank account that are not yet at investment risk generally do not count as a completed investment.
• The enterprise must be real and operating, and cannot be a marginal enterprise that only provides a basic living for the investor and family.
• The principal investor must be coming to the U.S. to develop and direct the enterprise; employees must hold executive or supervisory positions, or have specialized skills the enterprise needs to operate.

There is no fixed minimum investment for an E-2. USCIS emphasizes that whether an investment is substantial is measured against the cost of establishing or purchasing the enterprise, and generally the lower the cost of the enterprise, the higher the proportion of funds that must be invested.

Taiwan's visa reciprocity schedule shows that E-2 visas are valid for up to 60 months with multiple entries; under the current reciprocity schedule there is no visa issuance fee, but the regular visa application fee may still apply. Each admission in E-2 status is generally for up to 2 years, and those who qualify can extend in 2-year increments, with no fixed limit on the number of extensions. The E-2 is a nonimmigrant visa and does not by itself provide a direct path to a green card.

Taiwanese companies need to pay particular attention to the ownership structure. If a Taiwanese parent company owns the U.S. subsidiary, the review usually traces ownership up to the nationality of the ultimate shareholders to confirm that the E-2 nationality requirement is met. Shares held by Taiwanese shareholders who are U.S. permanent residents may not count toward the Taiwan-nationality ownership percentage the E-2 requires.

LLC or C-Corp: which should a Taiwanese company choose?

For a Taiwanese company setting up a U.S. subsidiary, a C-Corp or an LLC that elects to be taxed as a corporation is a common choice, because it usually lets the U.S. subsidiary carry its own federal corporate income tax filing obligations and reduces the complexity of the Taiwanese parent facing U.S. business income filings directly. This does not mean the parent has no U.S. tax obligations at all.

For an individual founder going to the U.S. to run the business, an LLC with default pass-through taxation may be simpler, but the founder still needs to assess personal income tax, state tax and nonresident filing obligations.

Taiwan and the U.S. currently have no comprehensive income tax treaty, so before choosing an entity type, we recommend having an accountant familiar with Taiwan-U.S. cross-border tax assess the tax burden and filing costs each structure may create.

What is an EIN, and how does a Taiwan-based responsible party apply?

An EIN (Employer Identification Number) is a nine-digit federal tax identification number issued by the Internal Revenue Service (IRS). It is usually an important prerequisite for a company to open a bank account, file tax returns and begin operating. A company may need an EIN even if it has no employees.

A Taiwan-based responsible party without a U.S. Social Security number (SSN) or Individual Taxpayer Identification Number (ITIN) can still apply for an EIN. According to the IRS instructions for Form SS-4, if the responsible party has no SSN or ITIN and is not eligible to obtain one, they can enter "foreign" or "N/A" on line 7b.

An EIN can be requested in the following ways:

• Online: Eligible applicants can usually get an EIN immediately, but the applicant must meet IRS requirements on a U.S. business location and taxpayer identification number, among others. A Taiwan-based responsible party without an SSN or ITIN usually cannot use the online application directly.
• By phone: Applicants who qualify as international applicants can call +1-267-941-1099 (Monday to Friday, 6 a.m. to 11 p.m. U.S. Eastern Time), and after eligibility and information are confirmed, may receive the EIN during the call.
• By fax: Fax Form SS-4 under the applicable IRS rules. International applications from outside the U.S. can use +1-304-707-9471. The official standard processing time is about 4 to 5 business days.
• By mail: Mail Form SS-4 to the IRS office designated for it. Applicants under the international application procedure can mail it to the EIN International Operation in Cincinnati.

Timing is an issue Taiwanese companies need to pay particular attention to. Although the IRS currently lists a standard timeframe of about 4 weeks for mailed applications and publishes processing status of about 30 days after a paper application is received, the actual wait can be much longer because of backlogs, document review or requests for more information. In practice, some paper applications may take 4 to 8 months, or even longer. This is a risk of possible delay, not a general processing deadline published by the IRS.

We therefore recommend that Taiwanese companies confirm their EIN eligibility and application method as soon as they start planning the U.S. company, and leave ample time so that bank account opening, payment flows or actual operations are not affected.

Which state, and what is a registered agent?

A U.S. company is formed under the laws of a particular state. If the company later sets up an office or warehouse, or actually does business, in another state, it may also need to register there as a foreign company (foreign qualification).

Companies that expect to bring in U.S. investors often choose Delaware; if the business will operate mainly in one state, forming the company directly in that state may avoid the extra foreign registration and maintenance costs.

U.S. states generally require a company to appoint a registered agent to receive court papers and other formal legal notices. For example, Delaware requires the registered agent to have a physical address in the state. A business that has not yet set up an office can hire a professional registered agent service company.

In addition, annual report, franchise tax and minimum tax rules differ by state, so the ongoing annual maintenance costs should be assessed together before forming the company.

What federal and state tax setup is needed in the first year?

• Federal tax: Apply for an EIN; a C-Corp generally must file Form 1120 by the 15th day of the 4th month after the end of its tax year, but some special years or companies have different deadlines. A foreign-owned single-member LLC must, where the rules apply, file Form 5472 with a pro forma Form 1120. The base penalty for failing to file Form 5472 as required is US$25,000.
• State tax: Based on where you operate, confirm your state income tax, franchise tax and sales tax registration obligations; before hiring employees, you may also need to register employer withholding and unemployment insurance accounts.
• Beneficial ownership reporting (FinCEN): Under the final rule effective August 14, 2026, companies formed under U.S. law are exempt from federal BOI reporting. If a Taiwanese company registers directly in the U.S. to do business as a foreign company, it should separately confirm whether it meets the definition of a foreign reporting company and the related obligations.
• Intercompany transactions: Loans, fund transfers, services or purchase transactions between the U.S. subsidiary and the Taiwanese parent should be covered by appropriate written contracts, and you should confirm whether Form 5472, transfer pricing or other tax reporting rules are involved.

What should you do before signing a U.S. lease or hiring?

• Settle the company structure and complete formation. State company registration can usually be completed in a few days to a few weeks, but the actual time depends on the state and the filing method. As a rule, the U.S. company should sign the lease and employment contracts, to avoid unnecessary liability for you personally or for the Taiwanese parent.
• Apply for the EIN early and arrange the bank account. EIN timing varies with eligibility and application method, and paper applications are more likely to see delays of several months, so leave enough time.
• Check whether the lease requires a personal or parent-company guarantee. U.S. landlords may ask a newly formed foreign-owned business for a guarantee; depending on the situation, you can negotiate a cap on the guarantee amount, its term, or an alternative form of security.
• Complete the required state registrations before hiring. These include employer tax, unemployment insurance and related labor law requirements, and, under USCIS rules, completing Form I-9 for employees hired in the U.S.
• Plan the timing of the E-2 application. An E-2 usually requires showing that the investment has actually been made or irrevocably committed, and the lease, equipment, expenditures and other evidence of operations may all be important. Plan the investment schedule and cash flow carefully, so the business does not take on excessive fixed costs before the visa is approved.
• Put Taiwan-U.S. intercompany contracts in writing. For services, distribution, loans and fund transfers between the parent and the subsidiary, confirm the legal relationship, transaction terms and tax treatment in advance.

Frequently asked questions

Is Taiwan an E-2 treaty country?

Yes. The U.S. Department of State's E-1 and E-2 lists include China (Taiwan). Eligible applicants from Taiwan can apply for an E-2 visa, and under the current reciprocity rules the visa is valid for up to 60 months with multiple entries.

How much do I need to invest for an E-2 visa?

There is no fixed minimum amount. The investment must be substantial relative to the cost of establishing or purchasing the enterprise, must actually be at commercial risk, and must be sufficient to support the normal operation of the enterprise. The amount and proportion of the investment should be assessed against the specific business plan.

Should a Taiwanese company form an LLC or a C-Corp in the U.S.?

When a Taiwanese company sets up a U.S. subsidiary, a C-Corp is a common choice; for an individual founder, an LLC may offer different management and tax flexibility. The choice should depend on who the shareholders are, the tax burden, financing plans and the E-2 ownership arrangement, not simply on comparing formation fees.

Can a company apply for an EIN without a U.S. shareholder or a U.S. Social Security number?

Yes. A U.S. company that is 100 percent owned by Taiwanese nationals can still apply for an EIN. A responsible party without an SSN or ITIN can apply using Form SS-4 under IRS rules, but the application method and timing depend on eligibility in each case. Some paper applications may take several months, so we recommend arranging it early.

Next step

WU LAW INTL PLLC provides U.S. company formation and cross-border business legal services. Admitted to practice law in New York State and connected to professional resources in both Taiwan and the U.S., the firm helps Taiwanese companies assess U.S. company formation and the ownership structure and business legal arrangements related to the E-2 investor visa, while coordinating the necessary tax planning with accountants in Taiwan and the U.S.

If you plan to form a company, open an office or warehouse, or hire your first employee in the U.S. within the next twelve months, you are welcome to contact us. Based on your business goals and planned timeline, we can help plan the appropriate formation and legal preparation steps.

Sources

• U.S. Department of State: Treaty Countries (E-1/E-2 treaty country list)
• U.S. Department of State: Treaty Trader and Treaty Investor Visas (E-2 qualifications)
• U.S. Department of State: Taiwan Reciprocity Schedule (E-2 visa validity)
• USCIS: E-2 Treaty Investors
• IRS: Limited Liability Company (LLC) federal tax classification
• IRS: Publication 542, Corporations
• IRS: Instructions for Form 5472
• IRS: Instructions for Form SS-4
• IRS: Processing Status for Tax Forms (EIN processing status)
• FinCEN: Beneficial Ownership Information Reporting
• Delaware Division of Corporations: Registered Agent FAQ
• USCIS: Form I-9, Employment Eligibility Verification

This article is based on public laws and administrative rules as of October 2026 and is for general information only. It is not legal or tax advice for any specific case. Actual eligibility requirements, processing times and filing obligations depend on the rules in effect when you apply and the facts of your case.