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.

We offer post-incorporation maintenance services, including compliance tracking, bookkeeping assistance, and tax filing support.

No.

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).

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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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.

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.

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.

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.

Yes, S corporations have restrictions on the types of shareholders they can have. Certain entities, such as other corporations, partnerships, and non-resident aliens, are generally not eligible shareholders.

Generally, foreign real estate isn't reported on an FBAR except when held through a foreign financial account like a foreign bank account, where exceptions may apply.

Foreign corporations conducting business in California must file Form 100 if they earn income from sources within the state.

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.

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.

Various factors influence the cost of bookkeeping services, from business size to required features. Find out about pricing structures, with options ranging from monthly fees to hourly rates with Inkle.

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.

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

Some exceptions and rules may apply, especially for entities like trusts and tax-exempt organisations. Consult Inkle today for entity-specific guidance.

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

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• Brand Name: What will your company be called?
• Entity Name: What will your company be registered as?
• Incorporator Name: This can be anyone.
• Incorporator Email
• U.S. Mobile Number
• Indian LLPs/RPs: One for each founder.

You will need basic information such as your company name, incorporator details, and any existing business entities in India.

Inkle Incorporate is a platform that simplifies the incorporation process for startups, particularly for Indian founders looking to establish businesses in the U.S.

We invite high-quality, active investors of various kinds, including VCs, angels, scouts and syndicates.

Yes, Inkle Books supports accrual accounting. The platform allows you to record revenues and expenses when they are incurred, rather than when cash is exchanged. This helps in tracking accounts receivable and payable, and in generating accurate financial statements that reflect your company’s financial position and performance over time.

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.

Reporting companies formed or registered on or after January 1, 2024, are required to report their company applicants. A company may have up to two potential applicants:

1. The person directly filing the document for company creation or registration.
2. If multiple individuals are involved, the person primarily responsible for directing or controlling the filing.

Suppose you fail to file a 7004 tax extension or tax return within the appropriate deadline (March 15, 2023, for S-corporations and partnerships and April 18, 2023, for corporations and other businesses). In that case, the IRS will charge interest and penalties on any unpaid Federal taxes.

If you do not file and owe taxes, the failure-to-file penalty is 5% per month (up to 5 months) of the amount due. If your return is over 60 days late, you may be subject to a $135 minimum penalty. The IRS will also impose a failure-to-pay penalty of 0.5% per month (up to 25%) of the amount due if you file a return or extension but don’t pay all your taxes on time.

While bookkeeping focuses on recording financial transactions, accounting involves interpreting, classifying, and reporting those transactions.

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

No. It's free.

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.

May 31 or June 30, 2023, for eFiling.

Corporations must provide detailed financial data, including gross receipts, deductions, credits, and other pertinent details essential for calculating net income and tax liability.

Inkle strongly recommends Accrual Method (over Cash Method,) because:

- it's gives a much truer picture of your finances.

- prevents you from getting any nasty surprises.- it is easier for forecasting.

- it is GAAP-standard, and most VCs will ask for it.

- you will eventually have to do Accrual Method anyway after you cross $25mm in revenue (by law) or sooner, so why not start with it.

- the IRS does not permit you to switch to Accrual (from Cash) in the middle of a year.

- restating and translating prior years' Cash books into Accrual method would be a nightmare, if you want to compare later.

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Cash Method is possibly OK if you have very little activity, or just started out or have no real revenue operations in US, but consult us for a discussion on this.

Because Accrual Method is more complex, we can only offer this to monthly customers. Trying to do Accrual Method once per year would just be too difficult for you and us, as we would have to discuss every transaction and invoice.

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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).

Yes, Inkle Incorporate is one of the only platforms for US incorporation compliant with Indian FEMA regulations

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.

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.

While the Delaware Franchise Tax Calculator can provide valuable insights into your potential tax liabilities, it may have limitations in accommodating unique business situations or changes in tax laws. Additionally, the calculator's accuracy depends on the inputted data. For comprehensive tax planning, using the calculator as a starting point and seeking professional advice when necessary is recommended.

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.

Form 1120 is a crucial tax document utilized by corporations in the United States to disclose their income, gains, losses, deductions, and credits for federal income tax goals. In Delaware, corporations are expected to submit Form 1120 if they are operating within the state or have obtained income from sources within its boundaries.

Bookkeeping is crucial to small business management, irrespective of growth plans. Understand how it not only tracks finances but also aids in accurate tax filings.

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.

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

No, the batch deadlines are only for founders. Investors will stay in out database and receive all batches.

Regardless of taxable income, every US-based domestic corporation must file tax Form 1120. 

The following entities fall under the obligation to file tax Form 1120:

1. Businesses opting for corporate taxation. These businesses must also complete Form 8832 and include a copy of Form 1120.
2. Limited liability companies (LLCs). LLCs file Form 1120 only if they've chosen corporate taxation. Partnership LLCs use Form 1065, while single-member LLCs typically file taxes through the owner's personal federal tax return.
3. Farming corporations. They are required to file Form 1120 to report their income/losses.
4. Corporations with an ownership interest in a FASIT (Financial Asset Securitization Investment Trust).
5. Foreign-owned domestic disregarded entities. If a foreign entity owns 100 percent of a domestic disregarded entity (D.E.), the D.E. is treated as separate from its foreign owner. The foreign entity must file Form 1120 and attach Form 5472.

Additionally, some types of corporations may need to complete additional forms, such as Form 1120 (Schedule N), for foreign operations in the U.S. Small corporations might not be required to fill out these additional forms. You can locate them by searching for "Form 1120" using the IRS Forms and Publications tool.

No fees to participate.

It's best to do a tax consultation with our certified professional tax experts who can help you determine the answer.

As a general rule of thumb: if you don't have a formal physical office, permanent employees in attendance, stock or inventory and business operations, then you won't need to file a State return. This is even if your US company address is located in that state. Basically: it depends on what you're doing in the state.

While the Delaware Franchise Tax Calculator can offer a reasonable estimate of your tax obligations, it's essential to remember that it may only account for some possible scenarios or nuances in Delaware's tax laws. For precise tax estimates, especially for complex business structures, it's advisable to consult with a tax professional familiar with Delaware tax regulations.

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

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

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

Form 8938 includes various foreign financial assets like bank accounts, investments, foreign entity ownership, etc. For a complete list of reportable assets, refer to IRS instructions.

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.

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 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.

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.

Individuals, estates, and trusts with qualified company income from pass-through entities, like partnerships, S corporations, and sole proprietorships, may be eligible to use Form 8995.

Providing false information or failing to report/update beneficial ownership may lead to penalties. Civil fines are $500 per day, and criminal penalties include fines up to $10,000.

If a report with inaccurate information is filed without the reporting company's knowledge, there's a 90-day safe harbor to submit a corrected report.

C Corporations must file Form 7004 on or before the original deadline of their tax return Form 1120, which is by the 15th day of the 4th month after the taxable year ends.

The deadline for C-Corporations following the calendar tax year is April 18, 2023.

Inkle's panel vets each startup on primary factors which all investors look for, such as team, market size, macro themes, product, disruption, progress. We do not conduct any due diligence or recommend investments. Investors do this themselves.

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.

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.

Considering a bookkeeping service is an intelligent choice if you're looking to save time and money. Discover how professional bookkeeping can help streamline your finances with Inkle.

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

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

• India LLP or subsidiary formation
• Apostille services (if required)
• Fundraising documents
• Stock plan adoption
• Attorney fees/advice
• Mailroom & post-incorporation services

Yes, there are exceptions based on ownership thresholds and specific circumstances. It's essential to review the IRS guidelines to determine if you meet the criteria for exemption from filing Form 5471.

You typically need to attach Form 8995 or its related schedules to your tax return to claim the QBID. The exact attachments required may depend on your situation.

In 2022, all companies that have foreign ownership or interests exceeding 10% at the end of the year are required to submit BE-12. This requirement applies to e-commerce platforms involved in digital product distribution as well as partnerships that hold real estate for non-personal purposes.

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.

Tax laws and forms can change from year to year. It's essential to check the latest IRS instructions and publications for any updates to Form 8995.

Inkle Books allows you to track payroll by integrating with payroll services or manually entering payroll data. If you use a payroll service, connect it through available integrations to automatically sync payroll information. For manual entry, record payroll expenses under the appropriate categories, ensuring accurate tracking of wages, taxes, and other deductions. You can also use Inkle Books’ reporting features to generate payroll summaries and review compensation costs.

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

Take the guesswork out and see the numbers for yourself.

Partners receive earnings on a monthly basis.

US VCs and angels often don't get India-based dealflow without feet on the ground, and because India founders don't reach out to you. Inkle Raise fills that gap, providing a liquid platform for receiving vetted and curated pitches from quality early stage teams that you probably haven't heard of before.

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

Form 2553 is the application to elect S corporation status for a business entity with the IRS.

No, it also includes compliance. You can pre-fix the purpose code and download e-FIRA for free from the dashboard to claim GST exemptions.

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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You should adjust your estimated tax payments to reflect the change in income. You can recalculate your estimated tax and make larger or smaller payments as necessary.

No, Inkle is not a law firm and does not provide legal advice. For legal matters, we recommend consulting a licensed U.S. attorney.

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.

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

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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.

If a business fails to e-file information returns like Forms W-2 and 1099-series when required, it may face penalties as outlined in IRC Section 6721. These penalties can be imposed for not filing electronically and for late filing or submitting returns with incorrect information.

In 2023, the potential penalty can reach up to $310 for each return, with a yearly cap of $3,783,000. However, for smaller businesses with annual gross receipts not exceeding $5 million, the maximum penalty is limited to $1,261,000. These penalty amounts are subject to annual adjustments based on indexing.

Additionally, hardship waivers are available for those who would encounter significant difficulties meeting the e-filing requirements.

If you have a Delaware C-Corp which was in existence during any calendar tax year (1st January to 31st December), then yes you must file the Annual Report and pay the Delaware Franchise Tax. This is going to cost you a minimum of $400 tax + $50 government filing fee, and possibly much more if you've raised in the millions.

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!

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.

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

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

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.

We appreciate your help in reporting bugs and have a vulnerability reporting system set up as documented here. Please reach out to security@inkle.io to report a bug.

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

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.

Form 5471 is filed by U.S. taxpayers, while Form 5472 is for foreign corporations in U.S. business or U.S. corporations with 25% foreign ownership.

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

BE-12 is a survey conducted by the Bureau of Economic Analysis every five years to collect data on foreign investment in the US. US businesses with foreign ownership or control must participate.

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.