Yes, there are income limits and phase-out ranges for claiming the QBID. The limits can vary based on filing status and taxable income.

Yes! India-resident founders should use the other tab to incorporate their US entity.

For your 2022 tax year and beyond, your taxable income might increase, possibly leading to due taxes even if you think you were loss making.

No. There will be no government fee for submitting your beneficial ownership information report to FinCEN.

The exempted companies that do not need to file BOI are:

• Big operational companies with over 20 full-time employees in the United States maintain a physical office presence in the US and have filed a federal income tax or information return demonstrating gross receipts or sales exceeding $5 million in the previous year.
• Companies involved in investments, along with advisors for investments and venture capital funds, are officially registered with the Securities and Exchange Commission (SEC).
• Pooled investment vehicles operated or advised by specific financial entities.

Book a meeting using the button at the top of this page, and we'll get you started.

US-as-a-parent: LLPs take about a month to create (formation, getting a bank account, starting the ODI process). Then the paperwork for the US parent takes just minutes to handle. Subsequently setting up a wholly owned subsidiary in India (a private limited company) takes about another month or so.

US-as-a-subsidiary: setting up a India Private Limited (Pvt Ltd) company takes a few weeks to do fully. The US subsidiary just takes a few minutes. Wiring the ODI payment from the Indian parent to the US subsidiary takes a week or two more.

No. It's free.

Inkle Books prioritizes the security of your financial information with robust measures. The platform uses encryption to protect data both in transit and at rest. Additionally, Inkle Books complies with industry-standard security protocols and offers multi-factor authentication (MFA) for added security. Regular security audits and updates ensure that your financial information remains safe from unauthorized access.

C corporations use Form 926 to report property transfers to foreign corporations.

You can find Form 1040-ES and its instructions on the official IRS website. Tax professionals and tax software like Inkle can also guide you in completing the form.

Individuals who expect to owe a certain amount of tax and don't have it withheld through their paychecks or other sources are generally required to file Form 1040-ES.

Some specific exceptions and exemptions exist for certain types of transactions and entities. For example, certain de minimis transactions may be exempt from reporting.

We open a Virtual Account with JP Morgan Chase for your Indian entity. You need to make a domestic wire from US Bank A/C to this Virtual Account, and then funds are credited in INR in Indian Bank A/C after currency conversion. Funds do not touch Inkle anywhere.

We use the Advanced Encryption Standard (AES) algorithm with a key size of 256 bits and with a unique and proper encryption key rotation policy for each customer.

You can get Form 1099 from the IRS website, request it from the IRS, or use tax software like Inkle for assistance.

Companies exporting goods or services from India need to furnish a Letter of Undertaking (LUT) on the GST portal. This allows them to make these exports without paying IGST upfront.  It is recommended to include the LUT Application Reference Number (ARN) on the Transfer Pricing invoice.

Here's a sample Invoice: drive.google.com/file/d/1sHgIx7AwswLQkUYnAaiGudN7ZMCh4XSi/view?usp=sharing

A beneficial owner is an individual who either directly or indirectly:

1. Owns or controls at least 25% of the reporting company’s ownership interests.
2. Exercises substantial control over the reporting company.

An individual is considered to exercise substantial control over a reporting company if they:

• Hold a senior officer position (e.g., president, CFO, general counsel).
• Possess the authority to appoint or remove specific officers or a majority of directors.
• Serve as an important decision-maker for the company.
• Exercise any other form of substantial control over the reporting company.

Obtain a 409A valuation before issuing your initial common stock options, after completing a round of venture financing, annually or after a significant event, and when approaching an IPO, merger, or acquisition.

Professional bookkeepers handle end-to-end financial management, including categorizing transactions, reconciling accounts, managing payables and receivables, and closing books monthly.

Yes. Inkle has built Inkle Practice specifically for non-US CA/CS and law firms to access the platform and collaborate with our shared customers.

The IRS requires businesses to file certain information returns electronically if they meet a minimum filing threshold.

Under current regulations, if your business files 10 or more information returns in total during a calendar year, you must submit them electronically. This is a significant reduction from the previous threshold of 250 returns.The requirement applies across multiple return types, including forms such as 1099s and W-2s, and businesses must aggregate all return types to determine if they meet the threshold. For example, if you file 2 W-2s and 8 Form 1099s, you are required to file all of them electronically since the total equals 10.

This mandate applies to most businesses, with limited exceptions, and affects how companies manage and submit their tax filings, especially those working with independent contractors.Failure to comply with the electronic filing requirement may result in IRS penalties for each return filed incorrectly.

For more information or if you have further questions about the program, you can reach out to the Inkle support team through Chat within the platform.

You can complete Form 2553 by providing information about your corporation, shareholders, and the S corporation election. The completed form is then submitted to the IRS.

C corporations conducting business in Delaware must pay an annual fee known as the Delaware state franchise tax, a privilege fee for operating within the state's jurisdiction.

The updated IRS electronic filing mandate has significant implications for businesses employing independent contractors. While many companies are accustomed to electronically filing W-2 forms, the inclusion of 1099-NEC forms, typically used for freelancers and 1099 workers, into this process is a new requirement. Businesses with many independent contractors must now develop standardized procedures for filing 1099-NEC forms to maintain organized records, including tax verifications and invoices, for smooth filing at year-end.

The change from a 250-return threshold to just ten is considerable, affecting many businesses that previously relied on manual filing methods.

This oversight can lead to compliance risks and unregulated spending. With the new mandate, it becomes crucial for businesses working with independent contractors to maintain a comprehensive overview of all 1099-NEC forms required for end-of-year filing.

To adapt, companies may need to assign specific roles, possibly within human resources, to manage independent contractor engagements. This would ensure consistent onboarding and payment processes across the organization, facilitating accurate reporting at the end of the year.

Additionally, implementing automated and centralized systems could significantly reduce administrative workload and the likelihood of manual errors.

Failure to pay the Delaware Franchise Tax and file the Annual Report for two consecutive years can result in the State of Delaware automatically dissolving the corporation.

Indian CA/CS/law firms can direct their customers to this page, or handle the process for them end-to-end. We will need certain documents/details from the founders, which can be routed through you.

All reporting companies should include the following information in the Beneficial Ownership Information report -

Reporting Company Details:

1. Legal name
2. Trade names
3. Current U.S. business address
4. Jurisdiction of Formation
5. Taxpayer Identification Number (TIN) or foreign-issued tax identification number and issuing jurisdiction.

Beneficial Owner Details:For each beneficial owner, the reporting company must provide:

1. Name
2. Date of birth
3. Residential address
4. Identifying numbers from an acceptable ID document (e.g., passport or U.S. driver's license) and the issuing state or jurisdiction. (Include a copy of the identification document used for obtaining the identifying number).

Company Applicant Details:Only applicable for companies incorporated on or after 1st Jan 2024. For each company applicant, the reporting company must provide:

1. Name
2. Date of birth
3. Address
4. Identifying numbers from an acceptable ID document (e.g., passport or U.S. driver's license) and the issuing state or jurisdiction. (Include a copy of the identification document used for obtaining the identifying number).

Individuals employ Form 1040 to file personal income taxes, whereas C corporations utilise Form 1120 for corporate tax returns. The primary distinction lies in the taxpayer type: 1040 is for individuals, and 1120 is for corporations.

Delaware is tax-friendly due to no sales tax, business-friendly tax laws, and favourable corporate income tax rates.

Filing Form 926 is crucial because it allows the IRS to monitor and track investments made by C corporations in foreign entities, ensuring compliance with tax laws.

Indian FEMA residents who wish to set up a US parent or subsidiary. Such founders may be all India residents or "mixed groups" (where one or more of the founders is India-resident, and one or more is not).

FEMA residency is a complex matter but the overall definition is: "The residential status under FEMA follows the main criteria that if an individual is in India for more than 182 days during the preceding financial year, he/ she shall be considered a Person Resident in India." More detailed discussion is required to establish the FEMA residency status of individuals, as there are other clauses which must be considered.

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Form 1040-ES payments are typically due quarterly, with due dates in April, June, September, and January of the following year. The exact dates may vary each year.

The specific information required may vary depending on the calculator, but typically, you'll need details such as the number of authorised shares, par value of shares, gross assets, and any additional factors relevant to Delaware's franchise tax calculation methods.

Our panel will systematically review pitches and curate a cohort of ambitious companies to showcase.

Notification of your selection status will be provided by Inkle by 31st Dec 2023.

If selected, you will be introduced on a double opt-in basis to the investors who wish to meet you.

If not selected, you are welcome to pitch again after further progress.

You can revoke the S corporation election under certain circumstances, but it typically requires shareholder consent and IRS approval.

You can use the worksheet with Form 1040-ES or online calculators to estimate the amount you should pay. It's typically based on your expected annual income and deductions.

Companies for IRS compliance and impartiality often prefer external appraisals, as independent experts ensure accurate evaluation of complex factors. This results in well-supported reports, reducing inaccuracies and conflicts with tax authorities.

You can find Form 2553 and its instructions on the official IRS website. Additionally, tax professionals and software can guide you in completing the form.

We ensure that data is backed up across multiple locations and can be retrieved within our recovery time objective if a failure does occur.

Additionally, we have a tested and detailed business continuity and disaster recovery plan in the event of a major disruption to one of our key service providers.

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Both are trusted incorporation partners, but they offer different features:

Clerky – Best for founders needing flexibility in share issuance, add-ons like SAFEs and stock plans, and an attorney collaboration portal.

Stripe Atlas – Best for ease of use, fixed share issuance, and perks like cashless founder stock purchase and massive Stripe discounts.

Auto-categorization may not be working for several reasons:

• Unrecognized Transaction Descriptions: The system might not recognize certain transaction descriptions or vendor names. Ensure your transactions have clear and consistent descriptions.
• Rule Misconfiguration: Review your categorization rules to ensure they are set up correctly and apply to the appropriate transactions.
• Data Sync Issues: Check if there are any issues with data synchronization between your bank accounts and Inkle Books. Ensure all accounts are correctly linked and updated.
• Custom Categories: If you have custom categories or exceptions, ensure these are configured properly within your settings.

If auto-categorization issues persist, consider reaching out to Inkle Books’ support team for further assistance.

Generally, income from eligible businesses, including domestic partnerships, S corporations, sole proprietorships, and certain real estate activities, may qualify for the deduction.

Foreign Inwards Remittance Advice (FIRA) is a document used in the Indian cross-border payments context. It is used as proof of a foreign currency conversion to Indian Rupees. FIRA is required to claim a GST refund for services or goods exported from India. We provide you with a free FIRA on your dashboard for every transfer, simplifying the process for you.

Due to the high volume of submissions, we regretfully cannot offer personalised feedback on individual pitch submissions. Nevertheless, you can enhance your pitch or prepare for future submissions by participating in our expert sessions or exploring our published content on our blog.

High tech early stage product startups with at least one founder or a subsidiary based in India. Even if you are in the pre-product or pre-revenue stage, you are encouraged to apply. We have no restrictions on valuation size and are open to evaluating startups from any business model focusing on building a US or global business. Being an Inkle customer is not a prerequisite for submitting a pitch, but we'd love to help!

Yes, IRS permits electronic filing using the Electronic Tax Administration system, offering convenience and extended deadlines.

To elect S corporation status for a tax year, Form 2553 generally must be filed two months and 15 days after the beginning of that tax year.

You may need one, the other, or both. FBAR is filed with the Financial Crimes Enforcement Network (and is based on calendar year), whereas Form 8938 goes to the IRS as part of your federal tax filing (and is based on your chosen tax year). FBAR is judged based on foreign balances controlled by your US entity's foreign accounts or its controlled entities foreign accounts, whereas Form 8938 is judged based on a threshold of specified passive income. See here for more details: https://www.irs.gov/businesses/comparison-of-form-8938-and-fbar-requirements

Indian FEMA residents may not directly hold control-level stock in any foreign corporation if that foreign corporation is going to have a step-down subsidiary anywhere in the world. The founders must hold their foreign stock through a personal Indian LLP (Limited Liability Partnership) or RP (Registered Partnership) vehicle in India. Think of this LLP or RP as the "personal family office" of each founder. So each LLP/RP would contain only the founder and her/his family member, not any other co-founder.

If you overpay your estimated taxes, you can apply the overpayment as a credit toward your next year's estimated taxes or request a refund when you file your tax return.

The QBID is a tax deduction that allows taxpayers to deduct a portion of their qualified business income from eligible businesses, potentially reducing their taxable income.

Delaware Franchise Tax Calculators are freely available online. However, it's essential to ensure you're using a reputable and accurate calculator provided by a trusted source, such as the Delaware Division of Corporations or reputable financial websites.

These include ongoing compliance support, charter amendments, NDAs, foreign qualifications, and more, ensuring your business remains in good standing.

There is a flat 0.25% forex markup fee on live mid-market rates. There are no other hidden fees, such as flat fees or GST deductions. Since we don't charge a flat fee, GST is not applicable.

Inkle is Stripe's India Crossborder Compliance Partner for the purpose of helping Indian resident founders use Stripe's Atlas product. We give end-to-end guidance and help smoothen the process. Stripe Atlas is actually a self-serve product, so you don't need Inkle, but we're always here to help.

If you don’t have a Mercury or Brex account, you can still connect your bank account to Inkle Books using Plaid, a secure financial data aggregator. Simply navigate to the “Data Sources” section in Inkle Books, select “Connect,” and click on “Other banking institutions” in the connect modal. Follow the prompts to connect your bank via Plaid.

Plaid supports over 12,000 US financial institutions, so you should be able to link your bank account without issues.

Yes, a 409A valuation can and should be updated if there are material changes in your company's financial situation or other significant events.

Yes, you may still be able to claim the QBID even if you have W-2 wage income, but some limitations and calculations take W-2 wages into account.

India TopCo = Indian parent with US subsidiary. US TopCo = US parent with an Indian Pvt. Ltd. subsidiary. US TopCo is best for global fundraising.

Form 8995 provides a step-by-step calculation process to determine the QBID. It involves determining your qualified business income, limitations, and other factors.

Take the guesswork out and see the numbers for yourself.

You earn rewards by sharing your referral link. When a friend signs up using your link and completes their first service, both you and your friend will receive $100 worth of Inkle Credits or an Amazon Gift Voucher.

Instead of a full deduction of the Foreign R&D expenses upfront in the year it was incurred, you'll now have to spread (amortize) them over 15 years. Domestic R&D expenses are fully deductible for tax years beginning after Dec 31, 2024.

We offer post-incorporation maintenance services, including compliance tracking, bookkeeping assistance, and tax filing support for US entities. Inkle doesn't maintain Indian entities, but we'll connect you to partners that do.

Required if US corporation did any reportable transactions at any time during tax year AND has any 25%+ foreign shareholder. See here https://www.irs.gov/instructions/i5472

C corporations can electronically file Form 926 through the IRS's Modernized e-File (MeF) system.

Yes if your US corporation had a foreign subsidiary at any time during the concerned tax year.

Our team will assist you every step of the way. Before we kickstart your incorporation process with Inkle, please prepare the following information:

• Brand Name: what will your brand name be? It's perfectly fine (and normal) for this to be completely different to your various entity names. Check that there is no US/India trademark violation or similar-named entities.
  
  
• Entity name/s: decide on the entity names (follow the specific regulatory requirements).

Rewards are processed once your friend completes their first service with Inkle. Payments are typically processed monthly.

A Delaware C Corporation (C Corp) is a type of business entity formed under the laws of Delaware and is taxed separately from its owners. A C Corp is considered a separate legal entity from its shareholders, meaning it can enter into contracts, own assets, and conduct business in its name.

In such cases, you need to rectify the mistake by amending the form. Utilise Form 1120X, the Amended U.S. Corporation Income Tax Return, for this purpose. Form 1120X must be submitted within three years from the original return.

To complete Form 1120X, you'll need the following information:

1. Business name
2. Explanation of changes
3. Business address
4. Details on payments and credits
5. Data on income and deductions
6. Tax amount due or overpayment
7. Employer Identification Number (EIN)
8. Signature

No fees to participate.

The Delaware Franchise Tax Calculator is a tool designed to help businesses estimate their franchise tax obligations to the state of Delaware. It typically works by inputting relevant financial information, such as the number of authorised shares and gross assets, and then calculating the expected tax amount based on Delaware's franchise tax regulations.

The Delaware Franchise Tax is an annual tax imposed on businesses incorporated in Delaware or have a presence there. It is not a tax on income but on the privilege of conducting business in Delaware.

A Transfer Pricing Benchmarking Study is conducted to determine the margin rate for transactions between the related parties. It is required annually from the second year of starting such transactions. A Transfer Pricing Audit (Form 3CEB) is a mandatory annual report that companies engaging in Transfer Pricing must file with the Indian tax authorities. Inkle can help you with both of these processes through our network of empaneled CA firms.

Generally this is the bulk of software development expense, which is often in the form of software engineer salaries. However, you can exclude the time they spend on maintenance (such as support and bug fixes).

US-as-a-parent: you will ideally have at least one India LLP per founder > one Delaware C-Corp > one Indian private limited company.

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US-as-a-subsidiary: one Indian Private Limited company > one Delaware C-Corp or LLC

Inkle offers a flat fee revenue-sharing model based on the volume of referrals and the services your clients use. Apply to learn more about your earning potential.

No.

It's good practice (but not mandatory with Inkle).

In our experience, many founders tend to just "leave it to the deadline" - and then rush or miss the deadline. And they have little visibility into their books at any given time.

If you come to us days before the deadline, it's really tough for us to catch up your books if you have lots of transactions and missing invoices. And almost impossible to use Accrual method. So we'll be forced to used Cash method accounting, which isn't ideal for you.

Many US tax filing services compel you to pay a high monthly bookkeeping charge of more than $500/month and subscribe to Quickbooks, even if you have low activity at the start. We have fair pricing and nudge you for monthly bookkeeping because it's better for you, and it will cost you about half of the total monthly cost over 12 months in terms of annual cleanup anyway. Why not have monthly visibility instead.

The Inkle Ambassador Program enables partners to earn a flat fee on referred customers. We provide the materials and resources you need to succeed.

C Corporations must file Form 7004 by the original due date of Form 1120 — the 15th day of the 4th month after the end of the tax year.For companies following the calendar tax year, this is typically April 15 (or the next business day if it falls on a weekend or holiday).

Click on the "Get My Referral Link" button. You will be redirected to the Inkle app, where you will be able to copy your referral link & share it with your community.

S corporations are pass-through entities, meaning profits and losses are passed to shareholders, who report them on their tax returns. Understanding these tax implications is essential.

FBAR requires reporting on various foreign financial accounts, including bank and investment accounts, and certain foreign retirement or pension accounts if they meet the reporting threshold.

Indian FEMA residents may not directly hold control-level stock in any foreign corporation if that foreign corporation is going to have a step-down subsidiary anywhere in the world. The founders must hold their foreign stock through a personal Indian LLP (Limited Liability Partnership) or RP (Registered Partnership) vehicle in India. Think of this LLP or RP as the "personal family office" of each founder. So each LLP/RP would contain only the founder and her/his family member, not any other co-founder.

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You can seek assistance from tax professionals, use tax software like Inkle, or refer to the IRS website for guidance and resources on completing Form 8995 and understanding the QBID.

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Detailed reporting on foreign corporation ownership, finances, operations, including key data, related-party transactions, and essential info.

No, our assisted service eliminates the need for expensive legal consultations. However, if you need legal advice, Clerky offers an optional attorney collaboration portal.

Inkle Books offers a variety of financial reports to help you manage and analyze your business finances. These include:

• Income Statements: Show your company’s revenues, expenses, and profits over a period.
• Balance Sheets: Provide a snapshot of your assets, liabilities, and equity at a specific point in time.
• Cash Flow Statements: Track cash inflows and outflows, helping you understand your liquidity.

Yes, you can electronically file through the FIRE system, often extending the deadline to March 31. Many tax software providers and e-filing services offer this option.

The IRS grants tax-exempt status to specific organisations, such as:

1. Charitable organisations
2. Social welfare organisations
3. Social clubs
4. Trade associations
5. Labor organisations
6. Veterans' organisations
7. Political organisations

The IRS maintains a comprehensive list of tax-exempt organisations, available here. These organisations are required to submit an information return, which may include Form 990, Form 990-EZ, and Form 990-PF.

Nil return means your US Corporation has no transactions in the concerned tax year.

Yes, both Form 8938 and FBAR might be necessary since they serve different purposes and have separate reporting thresholds. While FBAR has its requirements, Form 8938 is part of your annual tax return and may need to be filed, even if you're already submitting FBAR.

Bookkeeping records and reconciles transactions; accounting interprets and analyzes them.

In short - bookkeeping keeps data accurate, while accounting turns that data into strategy and compliance.

If you have paid a US resident contractor or an LLC as a contractual payment or rent, during the Concerned Tax Year, then yes you must file a Form 1099 by 31st January of the following year annually. One filing per person/LLC. If you've missed the deadline, discuss with us how to proceed.

Form 1040-ES estimates and pays your federal income taxes if you are not subject to withholding, such as self-employed individuals or those with significant additional income.

You are eligible to pitch once every six months.