Should I register my Etsy shop as a 'business' or an 'individual' if I have a New York LLC?

If you have an EIN and file taxes as a business entity (not a disregarded entity), register as a business. Etsy then verifies the entity name and EIN against IRS records, so the name has to match your New York Articles of Organization. A single-member New York LLC taxed as a disregarded entity can register as an individual and provide an SSN or ITIN.

What happens if I do not complete Etsy's seller verification?

Etsy withholds payouts until verification is complete, whichever state the shop's LLC comes from. If you miss the deadline shown in your Shop Manager dashboard, you have 90 days before the shop may be closed.

I do not live in New York. Can I still use a New York LLC on Etsy?

Etsy does not check where you live, only that the New York entity is validly registered and that the details you enter match New York's record. The catch is not Etsy, it is the state you actually operate from: states require an out-of-state LLC to register as a foreign LLC before it transacts business there, which is a second filing and a second fee on top of New York's $200. Forming in New York while working somewhere else usually means paying both states, not one.

Do I need a New York sales-tax permit before my first sale through Etsy?

Not for your Etsy orders themselves. New York charges a 4% state rate and, like every sales-tax state, has a marketplace-facilitator law that makes Etsy collect and remit it for you. You need your own New York registration once you also sell off-marketplace and either have physical presence in New York or cross its remote-seller threshold of $500,000 in sales AND 100 transactions (both must be met).

Marketplace Verification

How to pass Etsy verification with a New York LLC

What Etsy asks for at signup, and which New York LLC documents satisfy each requirement.

By Edmond Hui · Last updated: August 4, 2026

Edmond Hui · Founder, MyStateLLC

Edmond Hui is a software engineer and serial entrepreneur based in New York who has founded multiple online businesses across e-commerce, media, and information publishing. Before transitioning into tech, he spent years as a commercial real estate professional closing deals totaling over 100,000 square feet, giving him firsthand experience with business formation and entity structuring. He built MyStateLLC to provide the free, state-specific LLC guidance he wished existed when forming his own companies.

A New York LLC is generally eligible for Etsy verification — you will need to provide your Articles of Organization, EIN, beneficial-owner ID, and a valid US business address. Nothing about forming in New York blocks approval, and nothing about it guarantees approval either: the final call is Etsy's.

Etsy requires sellers using Etsy Payments to complete identity and tax verification before receiving payouts. For a New York LLC registered as a business (not a disregarded entity), Etsy collects the entity name as it appears on your Articles of Organization, the legal address, the EIN or other taxpayer number, and verifies this information against the IRS database. Etsy also requires a government photo ID and selfie via its identity-verification partner Persona, plus a bank account linked to receive Etsy Payments disbursements.

In New York the entity behind that check is an LLC created by filing Articles of Organization, which costs $200. New York does not publish a processing time for LLC filings, so treat state approval as the open-ended step in your timeline rather than the Etsy review. New York also requires newspaper publication after formation, so the LLC is not fully settled on the day the state accepts the filing. Because New York names a member or manager on a routine public filing, the owner name Etsy asks you to confirm is already a matter of public record.

New York has 116,072 solo retail trade businesses with no employees, averaging $79,971 in annual receipts (U.S. Census Bureau, Nonemployer Statistics (NES), 2023).

Not legal advice: Verification requirements change, and so do New York's filing fees and forms. Confirm current platform rules with Etsy, and current filing rules with the New York filing office, before you file. Etsy's requirements were last reviewed 2026-07-21, and New York's figures on this page come from its own published schedule.

What Etsy requires, and how a New York LLC meets each

Requirement	How your New York LLC satisfies it
LLC entity name verified against IRS	Use the exact LLC name as New York recorded it on your Articles of Organization; it must match your bank account holder name.
Employer Identification Number (EIN)	Provide your federal EIN (free from the IRS; non-US founders without an SSN must apply via Form SS-4 by fax or phone rather than the online tool) — independent of New York.
Taxpayer information and IRS verification	Complete the tax interview. A New York LLC owned by US persons typically submits a W-9 using its EIN; non-US owners of a disregarded-entity New York LLC generally use a W-8 form instead.
Government photo ID and selfie (via Persona)	Provide a government ID for each beneficial owner named in your New York filings. New York names a member or manager on a routine public filing, so at least one name already matches state records.
Bank account for Etsy Payments disbursements	Link a US business bank account opened with your EIN and your New York Articles of Organization.

New York-specific things to watch

New York names a member or manager on a routine public filing, so Etsy's beneficial-owner check will line up with public state records — you still upload a government ID for each owner. (The NY LLC Transparency Act (effective 2026) requires beneficial-ownership reporting to the state, and formation requires newspaper publication of the LLC's existence.)
New York requires newspaper publication after formation. Budget extra time before your Etsy application, since the LLC may not be finalized until publication is proven.
Budget for New York's ongoing LLC costs before projecting your Etsy margins: New York LLCs treated as partnerships/with NY-source income owe an annual filing fee of $25-$4,500 based on NY gross income.

New York sales tax & nexus rules for Etsy sellers

New York charges a 4% state sales-tax rate, and like every state with a sales tax it has a marketplace-facilitator law — Etsy collects and remits New York sales tax on your marketplace orders for you. You still need your own New York registration if you also sell off-marketplace (your own site, invoices) and either have physical presence in New York — an in-state location, inventory, or employees — or cross the state's remote-seller economic-nexus threshold of $500,000 in sales AND 100 transactions (both must be met).

New York requires BOTH the $500,000 revenue AND 100 transaction thresholds to be met simultaneously — exceeding only one is insufficient. New York's state rate of 4% is low, but New York City adds 4.5% and the Metropolitan Commuter Transportation District adds 0.375%, bringing the NYC rate to 8.875%. New York broadly taxes digital products and SaaS.

How to verify your New York LLC on Etsy

LLC entity name verified against IRS. Use the exact LLC name as New York recorded it on your Articles of Organization; it must match your bank account holder name.
Employer Identification Number (EIN). Provide your federal EIN (free from the IRS; non-US founders without an SSN must apply via Form SS-4 by fax or phone rather than the online tool) — independent of New York.
Taxpayer information and IRS verification. Complete the tax interview. A New York LLC owned by US persons typically submits a W-9 using its EIN; non-US owners of a disregarded-entity New York LLC generally use a W-8 form instead.
Government photo ID and selfie (via Persona). Provide a government ID for each beneficial owner named in your New York filings. New York names a member or manager on a routine public filing, so at least one name already matches state records.
Bank account for Etsy Payments disbursements. Link a US business bank account opened with your EIN and your New York Articles of Organization.

Non-US founders with New York LLCs

Non-US sellers can use Etsy Payments in supported countries, but a New York LLC's seller account must be linked to a US bank account or an eligible payment method. Non-US beneficial owners of a New York LLC must still complete identity verification via Persona with a valid government ID.

Frequently Asked Questions

: If you have an EIN and file taxes as a business entity (not a disregarded entity), register as a business. Etsy then verifies the entity name and EIN against IRS records, so the name has to match your New York Articles of Organization. A single-member New York LLC taxed as a disregarded entity can register as an individual and provide an SSN or ITIN.
: Etsy withholds payouts until verification is complete, whichever state the shop's LLC comes from. If you miss the deadline shown in your Shop Manager dashboard, you have 90 days before the shop may be closed.
: New York charges $200 to file Articles of Organization, and that is the state's fee to create the LLC. New York does not publish a processing time for LLC filings, so treat state approval as the open-ended step in your timeline rather than the Etsy review. Etsy charges nothing for verification itself, so the $200 filing fee and New York's ongoing obligations are the real cost of getting verified as a New York entity.
: Etsy does not check where you live, only that the New York entity is validly registered and that the details you enter match New York's record. The catch is not Etsy, it is the state you actually operate from: states require an out-of-state LLC to register as a foreign LLC before it transacts business there, which is a second filing and a second fee on top of New York's $200. Forming in New York while working somewhere else usually means paying both states, not one.
: Not for your Etsy orders themselves. New York charges a 4% state rate and, like every sales-tax state, has a marketplace-facilitator law that makes Etsy collect and remit it for you. You need your own New York registration once you also sell off-marketplace and either have physical presence in New York or cross its remote-seller threshold of $500,000 in sales AND 100 transactions (both must be met).