Shopify Business Formation Services

Starting a Shopify business is an exciting endeavor, but before you begin selling, choosing the right business structure is critical. The type of entity you form impacts your taxes, liability, and long-term financial health. At eBiz Accounting, we specialize in helping Shopify entrepreneurs select and set up the best legal structure for their eCommerce businesses. Contact a skilled ecommerce business accountant from eBiz Accounting for our Shopify business formation services today.

Choosing the Right Business Structure for Your Shopify Store

There are several business entity types to consider when forming your Shopify business. Each has distinct legal, tax, and operational implications. The most common structures used by Shopify sellers include:

Sole Proprietorship

A sole proprietorship is the simplest business structure. It requires no formal registration beyond obtaining the necessary licenses or permits. Profits are reported directly on the owner’s personal tax return, making tax filing straightforward. However, this structure does not provide liability protection. If your Shopify business incurs debt or faces legal issues, your personal assets could be at risk.

Limited Liability Company (LLC)

An LLC is one of the most popular choices for Shopify sellers. It provides liability protection by separating personal and business assets. Additionally, an LLC offers tax flexibility, as owners (referred to as members) can choose to be taxed as a sole proprietorship, partnership, or even an S Corporation (S-Corp) in some cases. Many Shopify entrepreneurs opt for an LLC because it balances simplicity with legal protection.

S Corporation (S-Corp)

An S-Corp is a tax designation rather than a separate business entity. Shopify business owners who elect S-Corp status can save on self-employment taxes by paying themselves a reasonable salary and taking the remainder of the profits as distributions. This structure is ideal for Shopify sellers generating substantial revenue who want to minimize their overall tax burden. However, it comes with additional regulatory and payroll requirements.

C Corporation (C-Corp)

A C Corporation is a fully separate legal entity from its owners. It provides the most liability protection but also comes with double taxation—once at the corporate level and again when profits are distributed to shareholders. While this structure is less common for small Shopify businesses, it can be advantageous for brands seeking venture capital funding or planning to scale significantly.

How eBiz Accounting Helps Shopify Sellers with Business Formation

Choosing the right structure is just the first step. Proper formation requires legal filings, tax registrations, and compliance with federal and state regulations. At eBiz Accounting, we guide Shopify entrepreneurs through the entire business formation process.

Entity Selection Guidance: We assess your business goals, expected revenue, and risk exposure to recommend the best structure.
State Registration & Compliance: We handle the paperwork required to legally establish your entity in your state, including Articles of Organization or Incorporation.
EIN & Tax ID Acquisition: We obtain your Employer Identification Number (EIN) from the IRS, ensuring your business can open a bank account and pay taxes properly.
Sales Tax Compliance: Shopify sellers must navigate complex sales tax obligations across multiple states. We help you register for necessary permits and understand your tax responsibilities.
Accounting & Tax Strategy: Beyond formation, we offer bookkeeping, tax planning, and compliance services to keep your Shopify business financially healthy.

Contact eBiz Accounting Today

Making the right business formation decision now can save you time, money, and legal complications in the future. eBiz Accounting specializes in helping Shopify entrepreneurs set up and structure their businesses correctly from day one. Contact eBiz Accounting today to schedule a consultation and take the first step toward a secure and successful Shopify business.