US LLC for Shopify and Dropshipping Store Owners
Published 3 September 2026 · Reviewed by Ashfaq Khattak, US Tax Consultant
A dropshipper or Shopify store owner outside the US forms a US LLC for one dominant reason: payment processing. Shopify Payments, Stripe and PayPal all onboard US entities in more countries, with better rates and fewer holds, than they onboard individuals in much of the world. If your applications keep being declined or your payouts keep being reserved, the entity is usually the fix.
Unlike an FBA seller, you probably hold no inventory in the United States — which means the state-nexus problem that dominates Amazon sellers’ compliance does not reach you, and Wyoming or New Mexico is a clean answer.
What the entity actually unlocks
- Shopify Payments is available in a defined list of countries. A US LLC with an EIN and a US bank account opens the US route where your own country is not supported.
- Stripe onboards US entities in most of the world through its programme for non-US founders, where a personal application from the same country would be refused.
- PayPal business in the company’s name, which is treated differently from a personal account on holds and disputes.
- Supplier credibility. US suppliers and print-on-demand partners frequently want a US entity and an EIN before extending terms.
What it does not do is make a processor overlook a high chargeback rate. Processors close accounts for dispute ratios, not for jurisdiction. An LLC gets you in the door; the store has to behave once inside.
Why dropshipping is simpler than FBA
Nexus follows physical presence. If your supplier ships direct to the customer and you never hold stock in the United States, you have no inventory in any state, and therefore none of the state-by-state registration exposure that FBA sellers have to manage.
Two caveats worth knowing:
- Your own site is not a marketplace. Marketplace facilitator laws make Amazon or Etsy collect sales tax for you. On your own Shopify store, sales tax is yours to handle where you have an obligation. Shopify will calculate and collect it — you have to configure it and file where you are registered.
- Using a US 3PL changes the answer. The moment you warehouse goods in a US state to shorten delivery times, you have created the presence you did not have.
Which state
Wyoming for almost everyone: low annual cost, ownership out of the public record, and wide recognition at banks and processors. New Mexico if you want the absolute minimum upkeep and can accept slightly less name recognition at onboarding — see the New Mexico page.
Not Delaware, unless you are raising money. Not Florida, unless you want your name and address on a free public search. Not California, unless you have to.
Your annual obligations
| Filing | Who to | When |
|---|---|---|
| State annual report | Secretary of State | Wyoming: your anniversary month. New Mexico: none. |
| Pro-forma 1120 + Form 5472 | IRS | Annually, single foreign member, even at zero revenue |
| Form 1065 + K-1s | IRS | Annually, two or more members |
| BOI report update | FinCEN | When beneficial ownership details change |
| Registered agent renewal | Your agent | Annually, and a lapse is how companies get dissolved |
The one people miss is Form 5472. A store that made nothing in its first year still files it, and the penalty for not doing so starts at $25,000.
What we do
- Form the LLC in Wyoming or New Mexico, whichever fits how quiet the company will be.
- EIN from the IRS, no SSN required.
- Operating agreement that satisfies bank and processor onboarding.
- BOI report with FinCEN.
- Banking guidance — which providers currently onboard non-residents remotely, and what each asks for.
- Annual filings kept current so a processor asking for a certificate of good standing gets one.
Frequently asked questions
Do I need a US LLC to use Shopify Payments or Stripe?
Not everywhere, but it is the usual solution when your own country is not supported. A US LLC with an EIN and a US bank account opens the US route to Shopify Payments and Stripe in most of the world, where a personal application from the same country would be declined.
Do dropshippers have the same state tax problem as FBA sellers?
No, and this is the main practical difference. If your supplier ships direct to the customer and you never hold stock in the United States, you have no inventory in any state and none of the state-by-state registration exposure FBA sellers manage. Using a US 3PL changes that.
Which state should a dropshipper form in?
Wyoming for almost everyone: low annual cost, ownership out of the public record and wide recognition at banks and processors. New Mexico if you want the absolute minimum upkeep and can accept slightly less recognition at onboarding.
Will an LLC stop my payment processor closing my account?
No. Processors close accounts for chargeback and dispute ratios, not for jurisdiction. An LLC gets you onboarded; the store still has to behave once it is.
Official sources
Rules, forms and fees on this page come from the following official sources, each checked on 2026-09-03. Government fees and deadlines change; confirm the current figure on the agency's own page before you file.