Insight
Doing business in the United States
October 2026
A market that continues to attract global business.
For businesses looking beyond their domestic markets, the United States (US) continues to offer a compelling proposition. With a GDP of more than US$30.7 trillion, according to the World Bank, the US remains the largest economy in the world, providing access to vast consumer markets, deep capital pools and one of the most dynamic business environments anywhere.
The scale of the opportunity is difficult to overstate. Figures from the US Census Bureau show the US population reached 340.1 million in 2024, with growth at its strongest rate in more than two decades. For international businesses, that represents access not only to a large customer base but also to a workforce, investor community and innovation ecosystem that continue to attract global attention.
That appeal spans industries and geographies. Businesses from Europe, Latin America, Asia-Pacific and the Middle East continue to view the US as a gateway to growth, particularly in sectors such as technology, professional services, advanced manufacturing and healthcare.
Yet while the opportunities are significant, today’s business environment is more complex than many international companies expect.
Confidence remains strong despite uncertainty
Economic headlines in recent years have often focused on inflation, political polarisation, global supply chain disruption and geopolitical tensions. Despite these challenges, entrepreneurship is booming in the US.
For many companies, the attraction lies not simply in market size, but in the ability to scale rapidly. Businesses often come to the US because they see the potential for growth that may not be available in their home markets. However, ambitions for growth need to be balanced with a clear understanding of the regulatory and tax landscape.
According to the US Chamber of Commerce, the number of applications filed to start new businesses has surged over the last few years. Application numbers doubled in 2020 compared to previous years, and this trend has continued, with over 5 million new business applications filed annually since then. In addition, international investors continue to demonstrate confidence in the US market, with the US Bureau of Economic Analysis stating that foreign investors spent US$232.2 billion acquiring, establishing or expanding US businesses during 2025, an increase of almost 50% on the previous year. The cumulative value of foreign direct investment in the United States now stands at approximately US$5.86 trillion, highlighting the country’s enduring appeal as a destination for international capital.
One country, fifty different operating environments
One of the most common misconceptions among overseas businesses is that the United States operates as a single, unified market. In reality, companies entering the US are often confronted by a patchwork of federal, state and local regulations.
While federal law provides the overarching framework, individual states maintain their own tax codes, employment regulations, compliance requirements and filing obligations. Businesses operating across multiple states may find themselves dealing with numerous regulatory regimes simultaneously. This complexity can create unexpected challenges for companies accustomed to more centralised systems.
For example, a business incorporated in one state may still be required to register, file returns and comply with regulations in every state where it has employees, customers, physical operations or sufficient revenue-generating activity. For international businesses, understanding where operations will be located often becomes just as important as establishing the right corporate structure.
Early planning pays dividends
One of the biggest mistakes overseas businesses make is treating compliance as an administrative issue rather than a strategic consideration. Ownership reporting, cross-border transactions, foreign affiliations and state registrations can all trigger filing requirements that may not exist in other jurisdictions. The consequences of overlooking these obligations can be costly – there can be significant penalties where required filings are missed or completed incorrectly.
As a result, businesses considering expansion into the US benefit from engaging local advisers well before establishing operations. Tax, legal and regulatory considerations are frequently interconnected, and decisions made early in the process can have long-term implications. For smaller organisations in particular, investing in upfront planning can prove far less expensive than correcting avoidable mistakes later.
Tax complexity requires local knowledge
Taxation remains one of the most challenging aspects of doing business in the US. Many overseas businesses focus initially on federal taxes. Yet state tax considerations often have an equally significant impact on overall liabilities. A federal incentive, deduction or depreciation allowance may not be recognised at state level. As a result, businesses can find themselves managing substantially different tax outcomes depending on where they operate. Cross-border organisations must also navigate transfer pricing requirements and demonstrate that transactions between related entities are conducted on an arm’s-length basis.
For companies entering the market, developing a coherent tax strategy from the outset is essential. The objective is not simply to minimise liabilities, but to ensure compliance while creating a structure capable of supporting long-term growth.
Technology and AI are reshaping the business landscape
One area in which the US continues to exert global influence is innovation. Artificial intelligence (AI) is increasingly shaping investment decisions, business strategy and competitive advantage across industries. Recent figures from the National Venture Capital Association show that US venture capital investors deployed US$320 billion in 2025, with AI-related businesses accounting for more than 65% of total deal value.
For international businesses entering the US market, this creates both opportunities and challenges. The pace of technological adoption is accelerating, but organisations must also consider issues such as governance, workforce readiness, cybersecurity and emerging regulatory expectations. Businesses that understand how technology is reshaping customer expectations and operating models are likely to be better positioned for long-term success.
Looking beyond the headlines
Tariffs, political debate and economic uncertainty will always attract attention. Yet businesses that focus solely on the headlines risk overlooking the fundamentals that continue to make the US an attractive place to invest.
The scale of the market, access to capital, entrepreneurial culture and appetite for innovation remain powerful advantages. Success, however, depends on recognising that the US is not simply a larger version of other markets. It is a highly diverse business environment where regulations, tax obligations and commercial conditions vary significantly from state to state.
For companies prepared to do their homework, seek expert advice and plan carefully, the opportunities remain substantial. The rewards can be significant, but so too is the importance of understanding the complexity that lies behind the world’s most influential economy.
New business applications by state
Growth rate of business applications (%), December 2022 – December 2023. Colorado, Iowa and North Dakota recorded the fastest growth, with the Mountain West and Upper Midwest ahead of the coasts.
<0%
0–15%
15.1–30%
30.1–45%
45.1%+
Source: US Chamber of Commerce.
About the author
Alan Kazden
Los Angeles, USA
Alan Kazden is a Partner at Rose, Snyder & Jacobs LLP, one of Russell Bedford’s member firms in the United States. Based in Los Angeles, he advises privately held businesses and international investors on US tax, compliance and business planning matters. He has a unique blend of skills in accounting, taxation and business consulting for businesses in diverse industries.
Alan works with established and emerging growth companies in strategic planning, raising capital and acting as a virtual CFO. He has extensive experience helping overseas organisations establish and grow operations in the US market. He works with both private and public companies.