If you’re new to selling on Amazon and want to make sure you’re doing everything right, a question on your mind might be “Do I need an LLC to start selling?”
The answer in one sentence: No you do not need an LLC to sell on Amazon as an individual.
However, there are times you will want to form an LLC, and times where some kind of incorporation (LLC or otherwise) is required.
In this post we’ll go over times you do and don’t need an LLC to sell on Amazon.
When you DON’T need an LLC to sell on Amazon
You are selling as an individual
This comes as a surprise to many, but to get started on Amazon you don’t need to incorporate in any way.
That means you don’t need to form an LLC, S-Corp, C-Corp, Partnership, or anything like that to get started.
Just pop in your Social Security number and you’re ready to start selling.
Of course, down the line if things start taking off you can always switch from selling as an individual to selling as a business, but keep in mind some situations that might be a bit confusing that we wrote about in another post.
Times you DO want/need an LLC to sell on Amazon
You want the protections an LLC provides
Technically you never are required to have an LLC to sell on Amazon as an individual, it’s purely a choice you make.
LLCs are taxed like individuals, so even if you do end up getting an LLC, you will still use your Social Security number as the way to be taxed for your Amazon sales.
An LLC, of course, offers you protections where selling as an individual doesn’t, so it’s good to incorporate eventually if you’re running an Amazon Seller account long term.
You are part of a business that has multiple members
Having multiple people who have ownership over a business running an Amazon Seller account is one of the few instances where you will need an LLC or some other formal type of incorporation to sell.
So if you’re in business with other people or the business has multiple owners, then an LLC or other formal incorporation is required to sell.
With the information in this post, you’ll know when it’s required to get an LLC for your Amazon business.
You can always change your business status down the line, but it’s best to get at least an LLC going eventually.