Selling Handmade or Dropshipping? Let's Talk LLCs
Whether you're crafting candles on your couch or dropshipping niche gadgets, starting an Etsy or Shopify store is exciting. But sooner or later, this question hits: Should I form an LLC for this?
Short answer? No, you don’t need one to get started.
Better answer? You might want one—especially if you plan to grow.
You Can Sell Without an LLC
Etsy and Shopify don't require an LLC to open a store. Here’s what you do need:
- An email and bank account
- Products or digital items to sell
- A way to accept payments (usually Stripe or PayPal)
- Compliance with tax and shipping laws
Most new sellers begin as sole proprietors—it's the easiest way to get going without paperwork.
When It's Smart to Get an LLC
Here’s when forming an LLC makes sense:
- You're making consistent monthly sales
- You’re sourcing or manufacturing physical products
- You want to protect your personal assets from refunds or legal issues
- You're building a real brand and want to look more professional
Bonus: You can use your LLC to open a business bank account, work with wholesalers, or qualify for certain tools like Shopify Capital.