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Shopify Payments for Foreign-Owned US LLCs

How to activate Shopify Payments, pass verification, and receive payouts when your LLC is owned by non-US residents

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US LLC Required

Shopify Payments needs a US entity

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US Bank Account

Payouts go to a US bank only

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EIN Required

Federal tax ID for verification

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2-5 Days

Typical verification time

What Is Shopify Payments?

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Shopify Payments is Shopify's built-in payment processor powered by Stripe. It lets your store accept credit cards, debit cards, Apple Pay, Google Pay, and Shop Pay without a separate gateway account. It is available to US-registered businesses regardless of owner nationality, provided the entity and banking are US-based.

Why Use Shopify Payments

  • No third-party transaction fees (saves 0.5-2%)
  • Built-in fraud analysis
  • Seamless Shopify dashboard integration
  • Automatic tax reporting (1099-K)
  • Supports Shop Pay accelerated checkout
  • Chargeback handling in Shopify admin

Key Limitations for Foreign Owners

  • Payouts to US bank accounts only
  • SSN or EIN required for tax reporting
  • Business address must be in the US
  • Certain product categories restricted
  • Rolling reserves may be imposed
  • Verification can stall without proper docs

Prerequisites: What You Need Before Starting

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Required Before Activation

  • US LLC or Corporation (formed and in good standing)
  • EIN (Employer Identification Number)
  • US business bank account (Mercury, Relay, Chase, etc.)
  • Business address in the US (registered agent or virtual office)
  • Passport or government ID of the account owner
  • Active Shopify store on a paid plan

Order of Operations

  • 1. Form US LLC and get Certificate
  • 2. Apply for EIN (SS-4, no SSN needed)
  • 3. Open US business bank account
  • 4. Set up Shopify store on paid plan
  • 5. Activate Shopify Payments
  • 6. Run test order + test refund

Shopify Payments Fees (US)

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Online Credit Card Rates

  • Basic plan: 2.9% + 30 cents
  • Shopify plan: 2.6% + 30 cents
  • Advanced plan: 2.4% + 30 cents
  • Plus plan: Negotiated rates

Additional Fee Details

  • No third-party gateway transaction fee
  • International cards: +1.5%
  • Currency conversion: +1.5%
  • Chargeback fee: $15 per dispute
All documents must match your LLC filing exactly

Business Verification

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Always Required

  • Legal business name (must match state filing)
  • EIN (exactly as on IRS CP575 or SS-4 confirmation)
  • Business address (US-based)
  • Business phone number
  • Business type (LLC, Corporation, etc.)
  • Industry / product category

Common Mismatches That Cause Delays

  • LLC name on Shopify differs from state filing
  • EIN letter shows different name or entity type
  • Address on Shopify differs from bank account address
  • Business category coded as restricted industry
  • "Doing Business As" name not registered with state

Personal Verification (Account Representative)

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Shopify requires verification of at least one individual associated with the business. For foreign-owned LLCs, this is typically the managing member or authorized representative.

Required Personal Info

  • Full legal name (as on passport)
  • Date of birth
  • Home address (can be non-US)
  • SSN or ITIN (if available)
  • Last 4 digits of SSN/ITIN
  • Government-issued photo ID

No SSN? Use This

  • EIN alone is accepted for business verification
  • ITIN works if you have one (Form W-7)
  • Passport number may be accepted for identity
  • Some sellers skip SSN field and verify by document upload
  • If stuck, contact Shopify support with EIN + passport

Banking Verification

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Bank Account Requirements

  • Must be a US-based business checking account
  • Account name must match LLC legal name
  • Routing number and account number required
  • Mercury, Relay, Chase, Bank of America all work
  • Personal accounts are not accepted for LLC payouts
  • Wise and Payoneer US account numbers sometimes work but are risky
Follow this exact sequence for the cleanest activation

Open Shopify Settings > Payments

Go to Settings > Payments in your Shopify admin. If Shopify Payments is available for your store's country (US), you will see "Activate Shopify Payments." Click it.

Enter Business Information

Legal business name (exactly as filed with the state), EIN, business address (US), phone number, business type (LLC), and industry. Double-check every field against your formation documents.

Enter Personal Information

Name, date of birth, and home address of the account representative (managing member). If asked for SSN, enter ITIN if you have one. If neither, leave blank and prepare to upload passport when prompted.

Connect Your US Bank Account

Enter your US business bank routing number and account number. The account name must match your LLC name. If using Mercury or Relay, find these in your dashboard under "Account Details."

Upload Verification Documents (If Requested)

Shopify may request: Articles of Organization, EIN confirmation letter (CP575), bank statement showing LLC name, government photo ID. Have clear scans ready. Response deadline is usually 7 days.

Wait for Verification (2-5 Business Days)

Shopify reviews your information. You will see status as "Pending" in the Payments settings. If verification fails, Shopify emails with specific reasons and what to fix.

Run a Test Order and Test Refund

After activation: use Shopify's Bogus Gateway to test checkout flow, then switch to Shopify Payments and place a real $1 order with your own card. Process a full refund. Confirm the payout appears in your bank within 2-3 business days.

Configure Payout Schedule

Default is daily payouts with a 2-business-day hold. You can change to weekly or monthly. New accounts may start with a longer hold period (7-14 days) that shortens with sales history.

Payout Schedule and Timing

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Standard Payout Timing

  • New accounts: 2-5 business day hold
  • Established accounts: 2 business day hold
  • Payout schedule: Daily, Weekly, or Monthly
  • Minimum payout: $0.01
  • Payouts arrive via ACH to your US bank
  • Weekends and holidays do not count

New Account Restrictions

  • First payout may be held 7-14 days
  • Rolling reserve (10-15%) possible for new accounts
  • High-ticket items may trigger manual review
  • Sudden volume spikes get flagged
  • Restrictions ease with positive sales history
  • First 90 days are highest-scrutiny period

Which US Banks Work Best for Payouts

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Mercury Address Warning (Updated 2025)

  • Mercury now rejects registered agent (RA) addresses as principal business address
  • If Mercury rejected your application, open with Relay instead — Relay approves foreign-owned LLCs in 1-3 days
  • See our business accounts guide for the full comparison

Recommended: Relay or Mercury

  • Foreign owners can open 100% remotely
  • Full ACH routing/account numbers for Shopify
  • No monthly fees or minimums
  • Dashboard shows Shopify payouts clearly
  • Relay: Thread Bank partner, up to 20 checking accounts, no SSN required
  • Mercury: Column N.A. + Choice Financial Group — requires real US address (not RA)

Also Works: Chase, Bank of America

  • Higher credibility with Shopify's risk systems
  • May reduce rolling reserve likelihood
  • Better for large payout volumes ($50K+/month)
  • Requires in-person branch visit to open

Avoid for Shopify Payouts

  • Wise borderless accounts (not always accepted)
  • Payoneer US account numbers (unreliable)
  • Personal checking accounts (must be business)
  • Non-US banks (not supported)

Tax Reporting (1099-K)

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What Foreign LLC Owners Need to Know

  • Shopify reports gross payment volume to IRS via 1099-K
  • Threshold: $600+ in gross sales (current rule)
  • 1099-K is sent to the EIN/SSN on the Shopify account
  • Foreign-owned LLCs still need to file US tax returns (Form 1120 or 1065)
  • If no SSN/ITIN: talk to your CPA about filing obligations
  • Some foreign owners need ITIN to avoid 24% backup withholding
Most verification failures are caused by document mismatches

Verification Rejected: Common Reasons

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Business Verification Failures

  • LLC name does not match EIN letter
  • Address on file differs from bank statement
  • EIN not yet in IRS database (wait 2 weeks after issuance)
  • Store country set to wrong jurisdiction
  • Product category flagged as restricted
  • LLC not in good standing with state

Personal Verification Failures

  • Name on passport does not match Shopify input
  • Date of birth mismatch
  • Blurry or expired ID document
  • Address verification fails (non-US address)
  • SSN/ITIN field left blank and no ID uploaded
  • Multiple failed verification attempts

Restricted and Prohibited Business Types

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Shopify Payments (powered by Stripe) prohibits or restricts certain business categories. If your products fall into these, you may be unable to use Shopify Payments at all.

Prohibited (Cannot Use Shopify Payments)

  • CBD, cannabis, or hemp products
  • Firearms and ammunition
  • Gambling and lottery
  • Adult content and products
  • Cryptocurrency sales
  • Multi-level marketing (MLM)
  • Counterfeit goods

High-Risk (May Require Extra Review)

  • Supplements and nutraceuticals
  • Dropshipping (high chargeback risk)
  • Pre-order or crowdfunding models
  • Digital goods and downloadable content
  • Subscription boxes
  • High-ticket items ($500+)
  • Products shipped from overseas

Payout Holds and Fund Reserves

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Why Payouts Get Held

  • Sudden spike in order volume
  • High refund or chargeback rate
  • Customer disputes filed
  • Shipping times exceeding 30 days
  • New account with no track record
  • Verification documents pending review

How to Resolve Payout Holds

  • Respond to Shopify emails within 24 hours
  • Upload requested documents immediately
  • Provide tracking numbers for all orders
  • Keep chargeback rate under 1%
  • Maintain consistent order volume (no sudden spikes)
  • Contact Shopify support with full documentation

If Your Account Gets Terminated

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What Happens

  • Shopify holds remaining balance for 120 days (chargeback window)
  • You can still use third-party gateways on your Shopify store
  • Your Shopify store itself is not affected (only the payment method)
  • You may be unable to reactivate Shopify Payments on the same EIN
  • Remaining funds (after chargebacks) are paid out after the hold period

If Shopify Payments terminates your account, switch to a third-party gateway immediately to avoid sales disruption. Your store continues to work; only the payment method changes.

Use these if Shopify Payments is blocked, restricted, or terminated

If your business category is restricted or Shopify Payments verification fails, these gateways integrate directly with Shopify. Note: Shopify charges an additional transaction fee (0.5%-2%) for third-party gateways on top of the gateway's own fees.

Stripe (Direct)

Full-service payment processor

Same underlying processor as Shopify Payments, but with a separate Stripe account you control directly. More flexibility on verification and payouts. Good fallback if Shopify Payments is blocked but Stripe itself approves your business.

Foreign-owned LLC US bank payouts No SSN required API-rich 2.9% + 30c + Shopify fee Multi-currency

PayPal Commerce Platform

PayPal + credit card processing

Widely trusted by consumers. Lets buyers pay with PayPal balance, cards, or Pay Later. Foreign owners can open PayPal Business accounts. Good for international customers who prefer PayPal.

Foreign-owned LLC PayPal + cards Pay Later options 3.49% + 49c (online) Buyer trust Fund holds common

Authorize.net

Gateway + merchant account

Traditional gateway, works with many merchant account providers. More manual setup but highly configurable. Better for high-volume or high-risk merchants who need a dedicated merchant account.

Requires merchant account US bank payouts High volume support Advanced fraud tools $25/mo + per-transaction PCI compliance tools

Square (Online)

All-in-one commerce platform

Integrates with Shopify as a payment gateway. Simpler verification than Stripe for some business types. Good if you also plan to sell in person with Square POS.

Foreign LLC (case by case) US bank payouts POS integration Free online store 2.9% + 30c + Shopify fee Limited international

Which Alternative Should You Choose?

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Best for Most Foreign-Owned LLCs

  • Start with Shopify Payments
  • If blocked, try Stripe Direct
  • Add PayPal as secondary option
  • This covers 95% of use cases

If All Else Fails

  • Authorize.net + dedicated merchant account
  • High-risk merchant account providers
  • May need to work with a payment consultant
  • Consider if business model needs adjustment