The best company structure for an event ticketing platform.

An event ticketing platform sits in the middle of a complex flow of funds. You collect customer payments for tickets to events that will happen in the future, hold those funds, and then pay out to event creators, minus your fee. This model creates specific structural needs.

First, you need a business entity that can be approved for a merchant account by a payment processor like Stripe or Adyen. These processors require a legally registered company in a supported country. For many ticketing platforms targeting a US audience or US-event creators, that means a US entity. Second, you need a business bank account in the name of that entity to receive settlements from your processor and to hold funds. This account is critical for managing operational expenses, payouts, and reserves. Third, the structure must be able to handle high volumes of transactions and large fund flows while satisfying the compliance requirements of banks who are sensitive to future delivery risk and potential refund liabilities if an event is cancelled. The company structure is the foundation for all these commercial relationships.

A single-member LLC, owned by a non-US person and treated as a ‘disregarded entity’ for US tax purposes, provides a clear legal wrapper for your platform. Its primary function is commercial: it creates a US-domiciled entity that can obtain an EIN, which in turn unlocks applications for US banking and payment services. This is not a loophole; it is the intended function of a simple corporate structure. For US event creators, contracting with and receiving payments from a US entity is standard practice. For US ticket buyers, paying a US entity is a familiar and trusted transaction.

What the structure does not do is eliminate your local tax obligations. You are still a tax resident of your home country, and the profits from your LLC are typically taxable there. It does not magically make a high-risk business low-risk; you will still face intense scrutiny from banks and payment processors. Finally, forming the LLC is only the first step. It provides eligibility to apply for a bank account, but it never guarantees approval. Banking is a discretionary decision made by the financial institution, based on their assessment of your business.

A single-member LLC owned by a non-US person is, by default, a ‘disregarded entity’. This means the LLC itself does not pay US federal income tax. Instead, the tax obligation passes through to its owner. The critical question becomes whether the owner’s income is subject to US tax. This depends on whether the income is considered ‘effectively connected’ with a US trade or business (ETBUS).

For many online businesses operated entirely from outside the US, with no US staff, offices, or dependent agents, the income may not be ETBUS. In such a case, no US income tax would be due. However, this is a facts-and-circumstances test that requires professional analysis. All foreign-owned single-member LLCs have a significant reporting requirement: they must file Form 5472 and a pro forma Form 1120 with the IRS each year to disclose the foreign ownership. Failure to file this, even when no tax is owed, carries a minimum penalty of $25,000. This structure requires careful administration and the advice of a qualified US tax professional to ensure compliance.

The choice of state for an LLC is often between Wyoming and Delaware. For most online event ticketing platforms owned by non-US founders, Wyoming is the more practical and cost-effective choice. Wyoming offers strong privacy protection (LLC owners are not listed on the public register), has no state corporate income or gross receipts tax, and features low annual maintenance fees. Its administrative requirements are straightforward, which is ideal for a simple, foreign-owned structure.

Delaware is a highly respected jurisdiction, known for its Court of Chancery and well-developed body of corporate law. This makes it the default choice for venture-backed companies or those planning to raise equity capital from multiple investors. However, for a single-owner, bootstrapped ticketing platform that does not anticipate bringing in outside investors, the complexities and higher costs of a Delaware entity, including a franchise tax, are often unnecessary. The legal advantages of Delaware are most relevant in shareholder disputes or complex litigation, scenarios that are less pertinent to a single-member LLC. Therefore, Wyoming typically provides the right balance of cost, privacy, and simplicity for this business model.

A US LLC with an EIN is the key to the US financial ecosystem. Payment processors that serve ticketing platforms, including Stripe Connect and its competitors, require a registered business entity in a supported country. By forming a US LLC, you meet this core requirement, allowing you to operate as a US-based platform. This enables you to accept USD payments via credit/debit cards and ACH bank transfers seamlessly.

Once processing is established, you need a US business bank account in the LLC’s name to receive the funds. Payouts from processors are settled to this account. From there, you can manage operational cash, hold reserves against chargebacks or event cancellations, and pay US-based event creators via domestic payment rails like ACH, which is cheaper and faster than international wires. This domestic financial footprint is critical. It reduces payment friction, lowers costs, and enhances trust with both ticket buyers and event hosts. Without the US LLC and its associated bank account, operating a compliant, scalable ticketing platform for the US market is nearly impossible.

Underwriters at banks and payment processors view event ticketing as a high-risk activity. Your business model is defined by future delivery risk: you accept payment now for a service (the event) that will be delivered weeks or months later. The primary concern for a financial institution is the risk of an event being cancelled, leading to mass refund requests and chargebacks.

When assessing your LLC, compliance teams will scrutinise your business model closely. They will want to see clear terms of service defining your refund policy and your liability versus the event creator’s. They will analyse your ticket volume, average ticket price, and the time gap between ticket sale and event date. Be prepared to explain your process for vetting event creators. Most importantly, expect mandatory rolling reserves. A processor or bank will almost certainly require you to hold a percentage of your settlement volume (e.g., 5-10%) in a non-accessible reserve account for a period (e.g., 90 days) to cover potential chargebacks. Having a clear, well-documented business plan that addresses these risks is crucial for a successful application.

For an event ticketing platform, the choice between Wyoming, Delaware, and Florida is less about tax and more about operational perception. Onboarding and compliance teams at payment processors see these filings daily. A Delaware LLC signals a potential venture-backed path, which can be helpful if seeking institutional investment, but it carries higher state fees and a franchise tax. It offers no practical advantage for payment processing over Wyoming.

Wyoming is the standard for non-US founders in e-commerce and digital services. Its low annual fee and strong privacy are well understood by financial partners. For a ticketing business, where future delivery risk is a core concern for processors, a clean, standard Wyoming structure raises no unnecessary questions. Florida, while a popular state for incorporation, can sometimes be perceived by processors as higher risk for certain business types due to a small minority of fraudulent actors. For a ticketing platform, avoiding any unforced perception of risk is key. The state of formation is a data point; Wyoming presents the cleanest data for this specific model.

Stripe, the most common processor for this model, will require your LLC formation documents, EIN confirmation letter, and personal ID. A high-risk review is almost certain for ticketing. Be prepared to show supplier agreements with venues, your refund policy, and evidence of past event history if available. A typical rolling reserve for new ticketing platforms on Stripe is 10-30% held for 90-120 days to cover chargebacks from cancelled events.

PayPal’s onboarding is often faster, but their risk reviews can be sudden and lead to account freezes. They are highly sensitive to spikes in refund rates or chargebacks. Avoid accumulating large balances. Shopify Payments (which is powered by Stripe) follows similar underwriting rules to Stripe directly, applying reserves based on the same future delivery risk logic. If selling through a marketplace like Eventbrite, they manage payments but will require you to have a connected bank account capable of receiving payouts, which means a US business account is still a necessity. Have your formation and EIN documents ready for all platforms.

The core third-party costs are predictable. A Wyoming LLC filing fee is $100, and its annual report is about $62. Delaware's filing is $90 with an annual franchise tax of $300. Florida costs more to set up but is comparable annually. A commercial registered agent service will cost between $100 and $250 per year.

The timeline is driven by external factors. LLC formation in Wyoming or Delaware takes 2-5 business days. Securing an EIN from the IRS without a Social Security Number is the main bottleneck; expect a wait of 3-5 weeks for the confirmation letter to be issued. Only then can you apply for a US business bank account, which can take 1-3 weeks for review and approval. Concurrently, you can apply to Stripe or other processors, which may take an additional 1-2 weeks for their risk review. From filing the LLC to receiving your first settled payout, a realistic timeline is 7-11 weeks. The process most often stalls at the EIN issuance and the payment processor's risk assessment.

The process of structuring your ticketing platform correctly is sequential. First, the LLC is formed in the chosen state, typically Wyoming. Once the state confirms the formation, the next step is to prepare and file the application for an Employer Identification Number (EIN) with the IRS. For foreign founders, obtaining an EIN can take several weeks or even months, depending on IRS processing times.

Only with the approved EIN in hand can you begin applying for a business bank account and payment processor merchant account. These applications require the legal entity formation documents and the official EIN confirmation notice. The entire sequence, from LLC filing to having an open and funded bank account, realistically takes two to four months. Xavion Capital manages this entire process. We handle the state filing, the EIN application with our signature on IRS Form SS-4 as your third-party designee, and the preparation and submission of banking applications across a portfolio of financial institutions whose risk appetite may align with the specifics of the event ticketing industry. To begin the process, visit xavioncapital.com/start.