Form a Texas LLC from Paraguay: Complete 2026 Guide

Texas in one paragraph: $300 to file ($300 online), then $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 each year. The state imposes 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. For a Paraguay-based owner the state choice mainly decides cost, privacy and paperwork, not your home-country tax result. If a large home market and a clear no-tax-due threshold is what you are optimizing for, Texas deserves a close look.

The cost side of a Texas LLC: $300 state fee ($300 online), a registered agent at typically $100-150 per year, a free IRS EIN, and a bank account that is usually free. Annual state requirement in Texas: $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. If you use EasyBrise, Global Launch is $295 for year one (registered agent included) and $149 per year after, and for a founder in Paraguay the whole first year typically comes in well under $500.

Texas fits if 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. Check the comparison table above before you commit, as switching later is not a simple amendment: the Texas LLC would be dissolved and a new one formed elsewhere.

Your Texas LLC exists once the state accepts the filing, but it is only ready to trade after these steps: sign the Operating Agreement; get the bank account open; apply for payment processors; calendar 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) and the federal Form 5472 and pro forma 1120. On BOI: FinCEN's rule in force since August 14, 2026 permanently exempts all US-formed LLCs, so there is nothing to file there.

The IRS international EIN line (267-941-1099) answers from 6 a.m. to 11 p.m. Eastern. Paraguay stays on UTC-3 all year. In US daylight time that window is 7 a.m. to midnight Paraguayan time; in US standard time it is 8 a.m. to 1 a.m. A daytime call suits both periods. Allow 45-60 minutes.

Here is how Texas formation works for someone in Paraguay. File the Articles of Organization with the Texas Secretary of State, using a registered agent's physical Texas address. Request your EIN from the IRS, writing "Foreign" or "N/A" in place of an SSN (phone: 267-941-1099, about 45-60 minutes; fax or mail: 4-6 weeks). Then apply for Mercury or Relay online. Every step can be done remotely.

With Paraguay taxing foreign income at 0%, a Paraguayan founder with large US revenue sees the US state picture most clearly in Texas: no state income tax, and no franchise tax below $2.65 million, though the May 15 Public Information Report is always due.

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 Paraguayan owner, Paraguay adds no tax on foreign-source income, so these US costs and the federal filings are the main recurring items.

Paraguay is not on Mercury's prohibited-countries list, which is based on country of residence, and it is not on Relay's list, which looks at owners' citizenship and residency. Both banks run their own reviews, so approval is not guaranteed. Neither bank's published rules restrict international wires involving Paraguay. Since the tax result depends on income being foreign-source, keep invoices and contracts that show your clients and the services delivered.

As a Paraguayan 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 7 a.m. to midnight Paraguayan time in US daylight time (8 a.m. to 1 a.m. 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.

Paraguay and the United States have no comprehensive income tax treaty in force. In this case that matters less than usual: with 0% tax on foreign-source income in Paraguay, there is no second tax for a treaty to relieve on the LLC's foreign business income. The relevant tax rules are the US rules for the LLC and for any US-source income.

Paraguay applies 100% territorial taxation: foreign-source income is taxed at 0%, and the country has no controlled-foreign-company regime to attribute an LLC's profit to you. For an owner resident in Paraguay, the LLC's non-Paraguayan business income therefore generally does not create Paraguayan income tax. The point to keep clean is the source of the income, since income that is Paraguayan-source stays taxable at home. The compliance work that remains is American: the LLC files Form 5472 and a pro forma Form 1120 every year, with a $25,000 minimum penalty for a missed or incomplete filing.

It helps to see how simple the Paraguayan position is beside its neighbours and peers. An Israeli owner has to think about Section 75B and the Circular 05/2004 election. A Chinese owner faces individual controlled-foreign-company rules from 2018 and a grey-area whitelist. A Colombian owner is inside the ECE regime with accrual taxation, and a Uruguayan owner has the 12% rate introduced in 2026. A Paraguayan owner has territorial taxation, 0% on foreign income and no CFC rules.