The restaurant industry in the United States has been showing a superior level of resilience throughout the pandemic and eventually remained one of the strongest segments in the country.
In this article, you will discover whether foreign nationals can open a restaurant business in the USA.
Can a Foreigner Open a Restaurant in USA? – The Verdict
US law does not restrict the ability of non-US citizens and non-residents to open a company in the country. As long as the foreign investor meets the applicable regulations, it is perfectly possible to open a restaurant in the United States.
However, opening a restaurant involves a long list of requirements that include licensing, permits, proper equipment, adequate premises to operate the business, and others.
Another aspect of opening a restaurant is work authorization. Opening a US business does not necessarily give a foreign owner the right to work on that same business. To perform any type of labor for a US business, a foreign owner needs to apply for work authorization.
Depending on the owner’s status, immigration status may allow him or her to work on the business. Most nonimmigrant visas have stricter conditions, while immigrant visas tend to offer more flexibility when it comes to work and study.
The best strategy is to work with an experienced US attorney to navigate the regulations that may apply differently to non-residents to ensure full legal compliance.
Foreign-Owned Restaurant in USA – The Essentials
Choosing the Appropriate Legal Entity
The first step to establishing a successful restaurant in the United States is choosing an ideal business structure. Besides S-corporations, foreigners can own C-corporations, limited liability companies (LLCs), partnerships, and sole proprietorships.
Each business structure has a different impact on the company’s operations and taxation, especially if there are other co-owners or members.
Dealing with Tax Implications
Whether the owner of a US restaurant is a non-resident or not, all income effectively connected with a US business will be taxed. Business owners must file the applicable forms with the Internal Revenue Service (IRS) and stay compliant with all applicable regulations.
The guidance of an expert business attorney is crucial to navigating US tax laws, as it may be the biggest challenge for foreign entrepreneurs.
Handling Licensing Regulations, Permits, and Zoning Laws
US laws have strict requirements when it comes to operating a restaurant business. The company must meet a heavy set of criteria to operate legally, including full compliance with local zoning laws.
One of the most demanding tasks involved in running a US restaurant is obtaining the required licenses and permits, as well as going through regular inspections and acquiring the necessary insurance policies.
Many foreign investors wish to open a restaurant in Florida. For example, opening a restaurant in Miami-Dade county requires the owner to comply with:
- Federal immigration laws
- Statutory rules for business registration
- All applicable licenses and permits at the state level (i.e., food, alcohol, etc.)
- Local licensing and zoning requirements (city and/or country rules)
- All applicable tax laws at the federal, state, and local levels
- Any applicable insurance requirements