Form a Texas LLC from China: Complete 2026 Guide

What makes Texas worth a look for someone in China: the state fee is $300 on paper ($300 online), and after that the state-level upkeep is $0 franchise tax for LLCs with revenue below the no-tax-due threshold ($2.65 million for the 2026-27 report years), but a Public Information Report (PIR) must still be filed every year by May 15 regardless of revenue — a full franchise tax return is only required above the threshold. The state levies no personal or corporate state income tax. Texas requires a public information report but does not always require individual member names to be listed depending on management structure. None of this changes your China tax position, which sits on top of the US picture, but it does mean Texas itself adds little friction. Among the five states we cover, Texas is the state with the highest upfront fee but a generous no-tax-due threshold.

Choose Texas when you expect meaningful revenue and want a state with no personal or corporate income tax and a straightforward no-tax-due threshold, and you don't mind a higher upfront filing fee. If your priorities lean another way, compare the other four states first, because moving a Texas LLC to another state later means dissolving it and forming a new one.

A US-China income tax treaty has been in force since the 1980s. For a single-member LLC owner the treaty's usefulness depends on how China classifies the LLC and on the type of income. Treaties generally do not switch off controlled-foreign-company rules, so do not assume the treaty answers the CFC question. Ask your Chinese adviser to confirm in writing how the treaty and the IIT rules interact for your income.

Checklist once the EIN letter arrives: (1) Operating Agreement signed and stored; (2) bank account application submitted; (3) Stripe and/or PayPal applications, subject to their own review; (4) your Texas annual obligation ($0 franchise tax below the $2.65 million no-tax-due threshold, plus a Public Information Report every May 15 regardless of revenue) in your calendar; (5) Form 5472 with a pro forma 1120 on the federal calendar. Federal Beneficial Ownership Information reporting is not something you need to do: FinCEN's rule in force since August 14, 2026 permanently exempts all US-formed LLCs.

The IRS international EIN line (267-941-1099) answers from 6 a.m. to 11 p.m. Eastern. China does not observe daylight saving, so when the US is on daylight time China is 12 hours ahead and the window is 6 p.m. to 11 a.m. Chinese time; once US clocks go back it is 13 hours and the window becomes 7 p.m. to noon. A morning call from China falls inside the window in both periods. Allow 45-60 minutes.

Forming from China is a five-step job. One: choose and check the name. Two: appoint a registered agent with a physical Texas address. Three: file the Texas formation documents. Four: obtain the EIN, entering "Foreign" or "N/A" where Form SS-4 asks for an SSN or ITIN; by phone on 267-941-1099 it takes about 45-60 minutes, by fax or mail 4-6 weeks. Five: open the business bank account online. No US trip is needed at any point.

Texas works for a Chinese founder building a US-facing business with real revenue: no state income tax, and no franchise tax below $2.65 million. The Public Information Report is still due every May 15, so keep a US-side reminder in place even if no tax is owed.

Here is the first-year budget for a Texas LLC owned from China. State filing: $300 ($300 online). Registered agent: typically $100-150 a year, or included in EasyBrise Global Launch at $295 for year one ($149 a year after that). EIN: free if you apply to the IRS yourself. Bank account: usually free at Mercury or Relay. Recurring state requirement: $0 franchise tax for LLCs with revenue below the no-tax-due threshold ($2.65 million for the 2026-27 report years), but a Public Information Report (PIR) must still be filed every year by May 15 regardless of revenue — a full franchise tax return is only required above the threshold. Most founders land well under $500 all-in for year one.

Over five years, the state-level cost of a Texas LLC is a $300 filing fee and nothing recurring, so $300 in total, before the registered agent. That makes Texas the second cheapest of the five states on this measure. The same arithmetic across the five states runs from $50 to $2,110. For a Chinese owner, the bigger variable is not this US state cost but how China's individual income tax rules and foreign-exchange quota apply.

As a Chinese owner, your recurring dates look like this. State: the Texas Public Information Report is due every May 15, even when no franchise tax is owed. Federal: Form 5472 with the pro forma Form 1120 is due on the return due date, April 15 for a calendar-year LLC, extendable with Form 7004. For the one-off EIN call, the IRS line (6 a.m. to 11 p.m. Eastern) is open 6 p.m. to 11 a.m. Chinese time in US daylight time (7 p.m. to noon in US standard time). Put the state date and the federal date in your calendar when the EIN arrives, because a missed Form 5472 carries a $25,000 minimum penalty.

Since 2018 China's individual income tax rules have included controlled-foreign-company provisions aimed at individuals who control entities in low-tax jurisdictions. Whether a US LLC falls inside them is not clear-cut. The question turns on a whitelist-style treatment of countries with comparable tax levels, and whether the United States qualifies for individual owners is a genuine grey area rather than a settled answer. Enforcement against individuals has historically been light, but light enforcement is not the same as legal clarity, so treat the point as open and get Chinese tax advice. On the US side the LLC files Form 5472 and a pro forma Form 1120 each year, with a $25,000 minimum penalty for a missed or incomplete filing.

The reason the whitelist question is unsettled is that the rules were written with companies and low-tax havens in mind, and applying them to an individual who owns a US limited liability company means reading provisions designed for a different fact pattern. A clear answer for the United States has not been published for individual owners. That does not mean the rules are being enforced against founders, and enforcement has historically been light, but it does mean you should record your reasoning and your adviser's advice.

China is not on Mercury's prohibited-countries list, which is based on country of residence, and it is not on Relay's list of countries whose citizens or residents cannot be owners. Approval at either bank still depends on that bank's own review. The harder constraint is currency control: China has an annual foreign-exchange quota for individuals (currently USD 50,000 equivalent under State Administration of Foreign Exchange rules) and requires supporting documents for cross-border receipts. How profit moves from a US dollar account into China is a Chinese-law question, so confirm the route with your Chinese bank or adviser before you rely on it.