Foreign Partner in U.S. Partnership

Hello All

I have a U.S. LLC treated as a partnership that has a LLC that was organized in a foreign country as one of the partners. The foreign LLC is owned by two domestic trusts that have U.S. citizen beneficiaries. I'm trying to determine if I have a 1446 withholding requirement. The U.S. partnership had a loss during the year but my understanding is that the 8804/8805 forms are still required, even if no withholding tax is due (assuming I have a reporting requirement).

Assuming the foreign LLC is a partnership and not a corporation, logically I wouldn't think there is a withholding requirement since the ultimate beneficial owners are U.S. citizens. Am I off base here?

Additionally, what forms should the U.S. LLC be requesting from the foreign LLC partner? Based on my research, I am thinking a W-8IMY from the foreign LLC and a W-9 from each of the domestic trusts that own the foreign LLC.

Appreciate any thoughts to point me in the right direction.

Yes the 8804/8805 is required if there's a foreign partner. 1446 withholding is based on estimated profits for the current year.

Is it possible for the foreign LLC to submit W-8IMY in order to report that the owners are U.S. persons, ultimately requiring zero withholding?

I don't know the answer to this. I do know from experience that it is problematic when a U.S. person tries to claim credit on their U.S. tax return for U.S. tax withholding against income of a foreign pass-through entity that is owned by the U.S. person. There is no specific way to do it on tax forms, and the IRS will sometimes disallow the credit.

What foreign country was the LLC organized in? I'm only aware of foreign LLCs in the context of US states that regard an out of state LLC as foreign.

LLC was organized in Nevis (Caribbean island)

It may not be reasonable to assume the Nevis LLC is a partnership.