Glossary
The plain-English glossary
Every term a global founder runs into — US entities, taxes, stablecoins, and India compliance — explained in one or two sentences.
US Entities
C-Corporation
A C-Corporation is a US company taxed as its own legal entity, separate from its owners. It pays a flat 21% federal corporate income tax on profits, and a second tax can apply when profits are paid out to shareholders as dividends.
Disregarded Entity
A disregarded entity is a business that is legally separate from its owner but ignored for US federal income tax — its income is reported on the owner's return instead. A single-member LLC is the most common example, so a one-owner US LLC is taxed as if the entity did not exist.
Foreign-Owned LLC
A foreign-owned LLC is a US limited liability company owned, fully or partly, by one or more non-US persons. A single-member version is usually a disregarded entity that pays no US federal income tax but must file Form 5472 with a pro forma Form 1120 each year.
LLC
An LLC (limited liability company) is a US business structure that gives its owners limited liability — separating personal assets from business debts — while passing profits through to the owners' personal tax returns by default. It is the most common entity for solo and bootstrapped founders.
LLP
An LLP (Limited Liability Partnership) is a business structure that combines the flexibility of a partnership with the limited liability of a company, so each partner is shielded from the debts and the misconduct of the other partners. In India it is a separate legal entity governed by the LLP Act, 2008 and registered with the Ministry of Corporate Affairs.
Registered Agent
A registered agent is the person or company you name to receive legal and government mail on your business's behalf at a physical address in the state where you form. Every US LLC and corporation must have one, and it must keep regular business hours so service of process and state notices never get missed.
Tax & Compliance
147C Letter
A 147C letter is an official IRS document that confirms an existing EIN and the exact legal name tied to it. You request it from the IRS, not apply for it, and it is used to verify your EIN when a bank or payment provider asks for proof.
BOI Report
A BOI (Beneficial Ownership Information) report is a filing to FinCEN under the Corporate Transparency Act that names the people who own or control a US company. As of June 2026, a FinCEN interim final rule exempts US-formed entities and US persons, so only foreign reporting companies file.
Delaware Franchise Tax
Delaware Franchise Tax is an annual fee every Delaware corporation pays the state to stay in good standing. It is not a tax on income or revenue, so even a company with zero profit owes it. For a typical startup C-Corp it starts at roughly $400 plus a $50 annual report fee.
EIN
An EIN (Employer Identification Number) is a nine-digit tax ID the IRS issues to a US business, like a Social Security number for your company. It identifies your LLC or corporation for federal taxes, payroll, and banking. Any non-resident can get one with no SSN required.
Form 1120
Form 1120 is the US Corporate Income Tax Return that a C-Corporation files with the IRS each year to report its income, deductions, and tax owed. A foreign-owned single-member LLC also files a pro forma 1120 alongside Form 5472, even with zero US activity.
Form 5472
Form 5472 is an IRS information return that a foreign-owned single-member US LLC must file every year to report transactions with its owner. It is filed with a pro forma Form 1120, even if the LLC had zero activity. Missing it carries a $25,000 penalty per form.
Form SS-4
Form SS-4 is the IRS application used to request an Employer Identification Number (EIN) for a business. Foreign founders without an SSN file it by fax or phone, and an EIN is required before any US bank account can be opened.
Form W-8BEN
Form W-8BEN is an IRS form a non-US individual gives to a US payer to certify they are a foreign person and, where a tax treaty applies, claim a reduced US withholding rate. It tells the payer you are not a US taxpayer.
ITIN
An ITIN (Individual Taxpayer Identification Number) is a nine-digit IRS tax-processing number for people who must file or be reported on a US tax return but cannot get a Social Security Number. It is issued via Form W-7 and is for tax purposes only.
SSN
An SSN (Social Security Number) is a nine-digit ID the US issues to citizens and work-authorized residents to track earnings and taxes. Non-resident founders abroad generally don't qualify for one, which is why most use an EIN or ITIN instead.
Tax Nexus
Tax nexus is the connection between your business and a U.S. state (or the U.S. itself) that is strong enough to trigger a tax-filing or tax-collection obligation there. It can be physical (an office, employees, inventory) or economic (enough sales or transactions into the state).
Stablecoin Payments
CCTP
CCTP (Cross-Chain Transfer Protocol) is Circle's system for moving USDC between blockchains. Instead of wrapping the token, it burns native USDC on the source chain and mints native USDC 1:1 on the destination chain.
Stablecoin
A stablecoin is a cryptocurrency designed to hold a steady value by pegging to a reference asset, usually the US dollar at 1:1. The most widely used is USDC, issued by Circle and backed by reserves with regular attestations.
USDC
USDC (USD Coin) is a regulated dollar stablecoin issued by Circle, designed to hold a 1:1 value with the US dollar and backed by reserves with regular public attestations. It lets you send and receive dollar value on blockchains like Solana, Ethereum, and Polygon in seconds.
USDT
USDT (Tether) is a stablecoin issued by Tether that aims to hold a 1:1 value with the US dollar. It is the most widely used dollar-pegged token for moving money across borders, settling on-chain in seconds instead of days.
India
FEMA
FEMA is the Foreign Exchange Management Act, 1999 — India's law governing all cross-border money movement, administered by the Reserve Bank of India. It sets the rules for how Indian residents may receive, send, and hold foreign currency, including payments from overseas clients.
FIRC
FIRC stands for Foreign Inward Remittance Certificate — proof issued by an Indian bank that you received money from abroad. It records the amount, sender, date, and RBI purpose code, and is the document auditors, tax authorities, and the GST regime accept as evidence of a legitimate foreign payment.
LRS
The LRS (Liberalised Remittance Scheme) is an RBI rule that lets a resident Indian individual send up to USD 250,000 abroad per financial year for permitted current and capital account transactions, through authorised banking channels.
One Person Company (OPC)
A One Person Company (OPC) is an Indian private limited company that can be formed and owned by a single individual, under the Companies Act, 2013. It gives a solo founder limited liability and a separate legal entity, while requiring a nominee who takes over if the sole member dies or is incapacitated.
Private Limited Company
A Private Limited Company (Pvt Ltd) is India's most common incorporated business form: a separate legal entity registered under the Companies Act, 2013, owned by shareholders whose liability is limited to their shares. It can raise equity, sign contracts, and hold assets in its own name.
RBI Purpose Code
An RBI purpose code is a standardised code that tags every cross-border payment into or out of India with the reason for the transfer. The Reserve Bank of India uses these codes to classify foreign-exchange flows for FEMA compliance and balance-of-payments reporting.