Why there is no comprehensive treaty
Argentina and the US have no comprehensive bilateral income tax treaty currently in force. Limited information exchange arrangements exist but they do not reduce US withholding rates or provide foreign tax credit mechanisms.
Practical consequence: US-source FDAP paid to your Wyoming LLC, when attributable to an Argentine-resident owner, faces the default 30% US withholding. There is no treaty rate to claim.
What default 30% withholding applies to
| Income type | Default US rate | Argentina status |
|---|---|---|
| US-source dividends | 30% | No treaty relief |
| US-source portfolio interest | 30% | Most exempt under domestic US rules |
| US-source royalties | 30% | No treaty relief |
| Business profits without US PE | Generally not taxed | No US tax regardless of treaty |
Argentine context: peso volatility drives LLC adoption
Most Argentine founders form Wyoming LLCs primarily to escape peso volatility on USD-denominated revenue, not to optimize US tax. USD held in Mercury or Wise accounts under the LLC retains value relative to peso-denominated alternatives, which is the dominant operational reason for the structure.
Argentine residents owe Impuesto a las Ganancias on worldwide income, so LLC pass-through income is reported on the annual Argentine tax return. Argentine peso valuations and inflation adjustments complicate the local-side reporting.
How AFIP treats US LLCs
Argentina's tax authority (AFIP) generally treats US single-member LLCs as transparent for Argentine tax purposes. LLC operating income flows through to your annual Argentine tax return and is taxed at progressive Argentine rates.
BCRA (Central Bank) rules govern USD inflows from your LLC into Argentina. Restrictions and reporting requirements can apply. Consult an Argentine CPA familiar with cross-border USD flows.
Common mistakes by Argentine founders
- Routing US dividend investments through the LLC and paying 30% FDAP unnecessarily
- Not declaring LLC ownership on Argentine tax return
- Missing AFIP foreign-asset declarations
- Not filing Form 5472 + 1120 ($25K penalty)
- Missing BCRA reporting on USD inflows