Delaware LLC from Russia: current sanctions status and what is possible

What sanctions changed

OFAC sanctions following 2022 events created new compliance requirements for US service providers dealing with Russian nationals. Formation services, banks, and payment processors have tightened acceptance criteria. Many decline Russian-resident founders entirely.

Sanctions are dynamic. Specific sanctions affect specific individuals (SDN list), industries (oil and gas, banking), and transactions. General Russian residence is not automatically sanctioned, but compliance burden has increased.

What is still possible

Russian citizens residing in non-sanctioned countries face fewer obstacles. Russian-American dual citizens face standard US-citizen treatment. Russian residents working in non-sanctioned industries may still form LLCs, though banking acceptance varies.

Critical step: engage a US sanctions attorney before formation. Compliance failures can result in substantial OFAC penalties. The cost of a sanctions opinion ($500-2,000) is cheap compared to compliance risk.

What is not possible

SDN-list individuals cannot form US entities. Russian state-affiliated entities cannot form US subsidiaries. Russian nationals in sanctioned industries face strong barriers. When in doubt, do not proceed without legal opinion.