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What is a related party on Form 5472? Definition

Related party on Form 5472 explained: who counts, why the owner of a single-member LLC is both the 25% foreign shareholder and the related party.

Amel Ouchene, IRS PTIN holder and CPA Candidate. October 19, 2026, 2 min read

On Form 5472, a related party is a person or company connected to the reporting corporation. The list in the Instructions for Form 5472 includes any direct or indirect 25% foreign shareholder, anyone related to that shareholder, and anyone related to the reporting corporation itself.

For a single-member LLC

You, the foreign owner, are both:

  • the 25% foreign shareholder reported in Part II, and
  • the related party reported in Part III, with the "foreign person" box checked.

If the LLC also dealt with your foreign company (for example it paid that company for services), that company is another related party, with its own Form 5472.

Why the count matters

  • The LLC files one Form 5472 per related party it had reportable transactions with. Line 1g of Part I gives the total.
  • The IRS manual counts the $25,000 penalty "once per related party per taxable year".
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Go further

24 min read

Form 5472 Line-by-Line Guide for Foreign-Owned US LLCs

Learn how to fill out Form 5472 and pro forma Form 1120 for your foreign-owned single-member US LLC. Line-by-line guide, worked example, fax and mailing rules.

Read the guide23 min read

Missed Form 5472 for Past Years? Step-by-Step Catch-Up Guide

Missed Form 5472 filings? Discover how to catch up on late Form 5472 filing, prepare pro forma Form 1120, submit reasonable cause, and handle IRS penalties.

Read the guide

This article is general information about US tax rules for foreign-owned LLCs, not advice for your specific situation. Rules change; check the date above and ask before you file.