Updates to US verification requirements
support.stripe.comI understand there are some larger compliance-related issues that need to be solved and that this seems like it's an unintended consequence of the regulatory requirements put in place to solve this.
But there are huge consequences for small business owners in requiring a physical address. I don't need or want anyone to ever physically appear at an address I provide, because providing _any_ address for my business is a fiction. My business is where ever I am. To date, I've paid for a registered agent service in my state so I can use their address. It costs me several hundred dollars a year for the "convenience" of not listing my home address in public records, which again, would also not be accurate because my business does not exist in my home. Same with a nonprofit I'm involved with - the nonprofit exists on Zoom and in temporary space we rent for meetings and events, and we receive mail to a PO Box.
There are also further downstream implications to this kind of problem. Suddenly if my business exists at my home address, my city wants a local business license and zoning compliance permit, so they can inspect the non-existent physical location and be sure the zero traffic it is generating isn't causing a burden on my neighbors.
Your business's primary place of business is your home (referring specifically to the parent comment, not businesses in general). That you can also carry out the business where ever you physically are does not change that basic fact from a legal or tax perspective.
Zoning compliance is not required for a home office (assuming white collar type work). Many, but not all jurisdictions require business licenses, even for home offices. This does not trigger inspections, because a business license isn't about the workplace, it's about the business itself.
EDIT/FOLLOWUP: Your "place of business" does not need to be your mailing address, because you can use a PO Box. It also doesn't need to be your address for legal service (i.e., for service of lawsuits), since most companies use a registered agent for that. At the most basic level, for a solo entrepreneur, your place of business is simply the one common location to which you have a legal right from which you do at least some of your business. In the absence of an owned or leased/subleased office or other workplace, it defaults to your residence.
What if I never do business in my home, but instead operate out of libraries, coffee shops, or client's locations?
Picture a carpet cleaning van parked on the street, for example.
If you're a sole practitioner (what this article is about) - by definition - your business is you. And you are most often in your home.
It's not that complicated.
You want the benefits of a business while not having to worry about angry customers annoying you at your house.
I don't blame you.
We all want to have cake and eat it, too.
> You want the benefits of a business while not having to worry about angry customers annoying you at your house.
What's the alternative here? Pay a couple hundred a year for a forwarding address that is sufficiently real enough for Stripe to accept?
Asking out of personal interest. I'm working on the solopreneur route and looking at what's available for myself. Would prefer to keep it away from my personal address.
Yes, this is the answer. Pay for a virtual address/agent, it's just part of the cost of doing business.
This isn't about angry customers knowing where you live. This is about angry government since it's for regulatory purposes.
you are most often in your home
Yet another baseless assumption.
You want the benefits of a business while not having to worry about angry customers annoying you at your house
Or one may wish to continue making money to feed themselves even though they cannot afford housing. Have you ever had to apply for apartments on self employment income?
Generally in the U.S., this has been a settled question for over a century. If you really have questions, there is guidance about this to govern pretty much every jurisdiction in the continental U.S.
For a solo entrepreneurship business in the U.S., your home is your place of business if you do not have another fixed place of business.
Consider the question unsettled. Or at the very least unsettling.
The address here would presumably be the one where you can be physically served a lawsuit.
My concern is that if I had an online business that I worked on at home, I still wouldn’t want my home address to be given out by my payment processor.
This is what I was thinking. Trying to do Service on a lawsuit/etc is a huge PITA.
When I bought my house many many years ago, I think I got something in the sale agreement about being able to operate a business out of my house provided it was just a mail-order business without associated traffic. (The seller was continuing to live next door.)
So I'm not sure about zoning in most places--especially today--but it wouldn't surprise me if there were some restrictions on business-related commercial traffic.
> I think I got something in the sale agreement about being able to operate a business out of my house
I don't understand this. Whatever requirements (if any) that apply to your home business are going to be set by the city/county (and those can change over the years). Your home purchase agreement doesn't have any jurisdiction over that.
In what jurisdiction does the former owner of a property have any say regarding what the new owner does with the property?
Any that allows covenants that run with the land. https://www.law.cornell.edu/wex/covenant_that_runs_with_the_...
I'm am not a property lawyer but I assume that's the case here. I assume were I to sell my property, the buyer couldn't unilaterally forbid my (now different) neighbor from using my driveway and, if they were to sell, the new neighbor couldn't forbid me from walking down to the river. Fortunately, people are pretty reasonable around where I live.
In my case I own land where certain parts cannot be logged beyond removing hazards. The deed for the land included the restriction, though my lawyer was at a loss as to who would seek to enforce it.
I assume that this is also how conservation covenants work. A new owner doesn't get to say "just kidding" and develop land that was turned into a property allowing public use with use restrictions.
In the jurisdiction where they have to actually agree to sell you the property. They gave me a couple of things (e.g. traverse their land to the river). I gave them a couple of things (like making the business aspect explicit and being able to use my driveway to get to their stable). Perfectly normal to have easements and other restrictions/conditions.
HOAs are a great example.
Where you do business and where you carry out business operations are quite often very different locations.
Pragmatically, there's a lot of great reasons to not use your personal address as a business address. I still have unemployment claims and financing offers chasing me for a company I started five years ago and closed four years ago.
For some reason, this doesn't seem to be a problem for me. For over twenty years, I've had a registered fictitious business name, a D&B number, and a registered US trademark tied to my home address. I don't even get junk mail for that.
> unemployment claims
Can you elaborate?
> Zoning compliance is not required for a home office (assuming white collar type work).
Actually, it is in my jurisdiction. I have to have a Home Occupation Permit for any type of business whatsoever registered at my home. This is why my address on file is my registered agent, in a different city in my state that does not have this absurd requirement.
> I don't need or want anyone to ever physically appear at an address I provide,
Is Stripe revealing this address to customers?
This page only says a business address must be provided, not that it will be revealed to customers.
If you have a business, you already have a business address and you're paying taxes somewhere. Why can't you use that address?
> Suddenly if my business exists at my home address, my city wants a local business license and zoning compliance permit, so they can inspect the non-existent physical location and be sure the zero traffic it is generating isn't causing a burden on my neighbors
What country are you in? Do you have any examples of this happening, or is this just a hypothetical you came up with?
Regardless, if your business is registered and you're paying taxes then, again, there's already an address associated with it. Stripe verifying this address isn't going to send local inspectors to your home.
> Is Stripe revealing this address to customers?
One needs to assume that policies can always change. I don't know if they are revealing the addresses today, but once they have them, they may well start revealing them next month.
Or they may have a data breach that just leaks everything.
> If you have a business, you already have a business address and you're paying taxes somewhere. Why can't you use that address?
As I said, I pay for the privilege of having a fictional address with a registered agent. It's a racket, but unfortunately, an unavoidable one until we stop this nonsense.
> What country are you in? Do you have any examples of this happening, or is this just a hypothetical you came up with?
The United States, and yes, I personally know someone who this happened to.
> Regardless, if your business is registered and you're paying taxes then, again, there's already an address associated with it. Stripe verifying this address isn't going to send local inspectors to your home.
My problem isn't with Stripe, it's with governments creating unnecessary hoops for people to jump through that don't actually solve any compliance issues. I pay for the privilege of avoiding it with a third party service that provides an address. I shouldn't have to. It doesn't help me, and it doesn't actually do anything for regulatory compliance.
There are virtual office addresses for this very reason
That was my first thought.
How is one of those small offices in a building somewhere that have 4700 businesses “located” in that one office any different from a PO Box at a local UPS store?
Effectively it’s not. They’re both lies. But one got cut off so now the other will pick up the slack.
> I don't need or want anyone to ever physically appear at an address I provide
I think this is the crux of it: who could see this information? Where is it flowing to now, and where can it flow to in the future?
> I don't need or want anyone to ever physically appear at an address I provide, because providing _any_ address for my business is a fiction.
Surely you see how this is also a desirable trait for every scammer out there?
> if my business exists at my home address, my city wants a local business license and zoning compliance permit, so they can inspect the non-existent physical location and be sure the zero traffic it is generating isn't causing a burden on my neighbors.
"this change makes it harder to violate the law" is not a compelling argument
You're missing the point. I don't operate a business from my home. I operate a business from my truck and from client sites. There literally is not a business at my home.
All businesses have a home. They must comply with a set of laws (yes, including business permits) and be able to respond to disputes. A business with no physical location is not practical in society.
> All businesses have a home.
There is a vast difference between a disgruntled violent person showing up at the address of SmallGuy LLC (which happens to be their home) and the same type of person showing up at the street address of, say, Apple who has thousands-strong security force.
> A business with no physical location is not practical in society.
This comment on HN of all places is clearly incorrect, since most web businesses don't exist in any physical location.
>most web businesses don't exist in any physical location.
They have employees, they have servers, they absolutely exist in a physical location.
> They have employees, they have servers, they absolutely exist in a physical location.
Many years ago, yes. Today, no.
The servers are in "the cloud". Employees are all remote, there is no location for the company itself.
My previous company was 100% remote from day one. I never met anyone in person.
> A business with no physical location is not practical in society.
That's an opinion, and my point is that I do not hold that opinion. It's only not practical because we make it impractical, not because any benefit is gained by forcing people to jump through hoops to set up and pay for virtual addresses.
The ability to compel someone to appear and answer for crimes committee by a business is a huge benefit. So is ensuring local businesses aren't undercut by businesses who claim no jurisdiction.
But that doesn't require an address. My filing with the Secretary of State in the state where I incorporate could just include a selection of which jurisdiction's laws I operate under. That's effectively what it is already, since I can choose where to have my virtual address. This would just cut out the gouging for a virtual address.
In my jurisdiction, and I suppose many others, a business must provide a physical address in order to incorporate, known as the registered address.
This does not have to be the place of business but is to ensure that legal documents may be served and other official letters delivered.
There are many services offering virtual office addresses for this.
It is not a problem. In fact, would you go into business with a company that has no address?
Worth a shot if anyone can help me out / is facing the same problem.
I'm a US non-resident (from the UK) who registered a business via Stripe Atlas, and used Earth Class Mail (a Stripe Atlas partner) to setup and incorporate my company when I signed up to Stripe Atlas.
Due to the nature of my business, a large majority of payments are micro-transactions, so I spoke with a Stripe employee who kindly enabled micro-transaction pricing on my account.
Fast-forward to a few months ago, and I decide to offer a subscription service for my business at a higher price point. I was advised by a Stripe employee to set up a new Stripe account for these higher priced transactions as micro-transaction pricing wouldn't make sense, so I registered a new US Stripe account using the exact same business details as my Stripe Atlas account (using my Earth Class Mail address, EIN, etc.)
My original US Stripe Atlas account seems to have passed this new US verification fine - whereas my new US Stripe account is threatened to have payouts/payments disabled on March 12th unless I provide a physical US address, as it doesn't like the Earth Class Mail one.
I have contacted Stripe customer support who have not been helpful - if there's anyone at Stripe who can help me with this I would hugely, hugely appreciate some help.
I am in a similar situation than you, after spending quite a bit of time on this, I think there are 2 possible solution:
* The slightly hacky one: Find a virtual office in the U.S. whose address isn't flagged by Stripe + get a virtual U.S. phone number
* The proper solution: You need to transition to a UK Stripe account and provide your UK address/phone number. Even though your business is incorporated in the US what seem to matter is where you effectively do business. As long as you can provide a proof you are effectively doing business from the UK, Stripe will not have any issue with getting you a UK based Stripe account for US based corp.
This is all very weird, especially as you said, Stripe Atlas specifically encourages you go the registered agents route, only to then have the rug pulled from under your feet.
I've been banging my head against a wall the past few days trying to work out a solution to this. I've yet to make a decision, but my discoveries / theories so far:
- Stripe Atlas accounts are treated separately to regular US Stripe accounts at the moment when it comes to address verification. My Stripe Atlas account has passed this verification fine because of this difference (maybe because Stripe auto-uses the Delaware registered agent I paid for during Stripe Atlas setup as physical address?), but a regular Stripe US account using the same Earth Class Mail address fails verification. Stripe support says this: 'The address given to you on your Stripe Atlas account will be valid as it is provided by our partner, but then for normal Stripe account, one requirement is to have a physical business address.'
- I'm wondering if the Earth Class Mail address for my Regular Stripe US account is failing specifically because it has the words 'PMB XXXX' (private mailbox) in the first line of the address. This address was given to me at random by Earth Class Mail when I created my Stripe Atlas account, and I didn't really think anything of it - but I can see how 'PMB' is an instant red-flag for not being a physical location. The exact error message I get is: 'Invalid address. Your business address must be a valid physical address from which you conduct business and cannot be a private mailbox'.
- Also stumbled across the virtual office solution. Instead of PMB's they have 'suite numbers' in an actual building. I agree it also feels hacky, and likely to come under the same verification issues, but might a short term fix for my PMB issue. A lot of the services I contacted seem a bit shady though. I even emailed one of Stripe's partners (usestable.com) with a specific question regarding if their virtual addresses still work with Stripe, and have so far got no response.
- Co-working spaces like WeWork and Regus offer a virtual office service, which seem a bit more legitimate than some of the specific virtual office services I've seen, but come with a higher price-point.
I will probably try a cheap virtual office solution first, then move onto the co-working solution if that fails. I want to try and avoid switching Stripe accounts if possible as I think it's going to cause a lot of pain with migrating subscriptions etc.
The meta-issue here is the quality of Stripe support. I have paid so much to Stripe in transaction fees, but when a problem like this threatens to shut down an account I operate, all I get from them is vague answers, pointing to documentation, and 'computer says no' responses from people who have no idea what they're talking about.
What does this mean for their partners like Stable? The only reason I used Stable was because it was part of the onboarding flow for Stripe Atlas. Is that considered a physical biz address?
FWIW my biz address doesn't have PO box in the address. It is re-used though (which I know because when I tried to register a DUNS number with Apple the first problem I ran into was another business was already registered at the same address)
They don't even really specify this in their link in the email sent, but I am getting this error when going to my dashboard now:
Invalid address. Your business address must be a valid physical address from which you conduct business and cannot be a private mailbox. Please correct the following...
So now, I have to find a new business address (either rent a place, or do a virtual office), which isn't as simple as just getting a new address. I then have to update every single account online or in person that uses it, and officially ask my state's SoS to update my biz info. There is probably other stuff I am not even thinking of in this moment as well. In addition, Stripe wants me to get a new biz address before March 13th or "payouts" will be impacted. Not processing! They are happy to use my money to make money for themselves and hold it like they have done to others in the past indefinitely.
This is all probably related to CTA and BOI changes that began this year that are seemingly affecting small biz more than the corporate entities that this bill supposedly was about.
https://home.treasury.gov/news/press-releases/jy1974
Once again, Thanks Stripe. It's been real, but it's probably time to move on.
This is the message I see in my account:
> Invalid address. Your business address must be a valid physical address from which you conduct business and cannot be a P.O. Box. This address is not shared publicly and can be your personal address. You may use a P.O. Box as your customer support address.
So in other words, a personal home address should work.
Although its odd your error message is seemingly saying a personal address doesn't work, unless "private mailbox" means a privately rented commercial box, like UPS
> Although its odd your error message is seemingly saying a personal address doesn't work, unless "private mailbox" means a privately rented commercial box, like UPS.
Yeah, services like Earth Class Mail specifically hand out addresses that say "PMB XXXXXXXX" where PMB is "Private Mail Box".
My personal address isn't my business address. They are different. Mixing the two, while seemingly innocuous, actually can mean opening myself up to liability issues or a good argument that the biz that I operate isn't actually different from me the person. This isn't going to matter in 99% of things, but if you are ever sued, can be used as a reasoning to actually be able to retrieve damages from you the person versus just from the LLC. It's one of the reasons to try to have a strong separation early on in the biz, if you can. The IRS also doesn't like the mixing funds and such with bank accounts. It's the same reasoning, just different domains.
I get that (and agree separating biz and personal as much as possible is 100% best practice)
But there are tons of legitimate businesses operated out of residential addresses (therapists, psychiatrists, chiropractors, etc). It’s not abnormal to use a home address for business purposes.
I’d recommend checking with your lawyer to verify, but I don’t think the address on your stripe (or even bank) account would legally make a difference
I am facing this issue where I received an Earth Class Mail PMB XXXXX address when setting up my Stripe Atlas account and registering my business (I am a US non-resident), and now my account is being threatened to be shut down in 14 days if I don't get a new address. Is this a problem with Earth Class Mail addresses all being P.O box / virtual addresses? Or have I just gotten unlucky with the address I was dealt?
> This address is not shared publicly and can be your personal address.
But who will it be sold to privately?
It will be given away to the government for free
> Once again, Thanks Stripe. It's been real, but it's probably time to move on.
I don't follow. The CTA and BOI things you linked to are from the (US) government, so everybody else has to force you to do the same thing. Are you just shooting the messenger here?
The separation of personal and biz addresses is an important concept in owning a business. Not only for privacy, but for proving the biz is a separate entity and such. This is probably one of 2 - 3 recent changes that they have imposed on my biz, all without seemingly any lead time. 15 days isn't really a lot of lead time to change your business address when you are over capacity already and have to (or would much prefer to) focus on things that actually make money. The one previously was a change that turned me previously paying $0 a month to over $60 (maybe $80 or more depending on volume) for the same feature set. Once again, without notice. Having a UPS box has for years been recognized as a legitimate way to have a biz address as well. Just not USPS PO boxes. The CTA and BOI legislation doesn't impose restrictions on that as far as I know, but Stripe does? My bank accepts my business address as a UPS box, but Stripe doesn't? That doesn't seem right. The CTA and BOI are more closely aligned with the banking secrecy act, which is just uncle sam wanting to know that a real person with a residential address owns a given bank account to prevent money laundering etc.
> The CTA and BOI legislation doesn't impose restrictions on that as far as I know,
ah. The two options here are either the 2024 rule change means it now does, which I'm assuming stripe's (and at least a few other companies, it sounds like) lawyer's read is it does. Or it doesn't and they're being a bag of dicks. which explains your reaction.
¯\_(ツ)_/¯
There are competitors to stripe. Why people keep submitting themselves to their abuse is beyond my comprehension.
Do these competitors need to follow a different set of KYC/AML regulations than Stripe?
This "abuse" and all the half dozen other "look at this abuse this <company I do financial transactions with> is now doing" in the last few days is actually maybe due to some new requirements effective Jan 1 2024 in the US that entities that do business here have beneficiaries registered https://www.federalregister.gov/documents/2022/09/30/2022-21...
Would be interested in a list of the competition. (too lazy to do my own research)
Square is probably the most similar competitor (in the US at least). Paypal has some similarities. Venmo in some ways. Clover. Ayden. Stax. Wave. There are others. Of course, most banks can also provide credit card terminals and merchant services for business customers too.
Mercury also rolled this out recently. got the email yesterday.
Given the timing, I wonder if this has anything to do with compliance of FinCEN's new Beneficial Ownership Information Reporting requirements.
I think this is exactly related to that. Someone was whining in a different post yesterday for similar new requirements from google to publish an app on the Play Store and they felt that was "discriminatory" and devs should "band together to sue them".
Thanks for reminding me, I also got an email from Google about that. It seems like there is a larger force at play rather than a coincidence that all of these companies suddenly have similar requirements.
Yes, there are new reporting requirement effective Jan 1 2024 in the US that entities that do business here have beneficiaries registered https://www.federalregister.gov/documents/2022/09/30/2022-21...
I use a registered agent and a mail service. Basically, if the RA receives mail for my business they digitally scan it and email it to me. Costs $200/year and can go up to $600/year depending on how much mail you receive.
I have a similar setup. Be sure to check your state's laws before signing up for an RA service - my state allows an LLC to be its own RA.
Isn't this normally required when getting a US state business license as it is?
It is not, you can just register a registered agent service. Many services, like Stripe Atlas, will provide this for you, for free, at incorporation time.
There are probably a number of edge cases around physical permanent addresses for both individuals and businesses that I suspect are less edge than they used to be.
Another classic issue with draconian regulations that could be easily solved with Web3 payments.
It's not so easy for customers to buy crypto to make these Web3 payments. If your bank is Chase you basically cannot without them closing all your accounts.
Chase doesn’t let you send funds to Robinhood or coinbase?
Fwiw I used Solana pay last year in a brick and mortar retail, and it was on par with Apple Pay UX. Granted I already had phantom on my phone with funds in it.
But yeah I hear you that asking someone to download a wallet and fund it isn’t a great way to run a business. But if the burden of regulations becomes too high, I could see it being a thing. Fwiw, I see the need for regulation here, but regulation needs to be weighed against the damage it does to small businesses and individuals just trying to do a side hustle.
Chase will let you but then close your accounts within 6 months when their trust and safety team does their audit triggered by your transaction. It's a well known thing that Chase loves to boot customers for sneezing the wrong way while interacting with them.
"the only way to have effective business regulation is bitcoin" is probably the most HN thing I've ever read
Many people at RenFaires and music festivals use Stripe. This is going to wipe them out as customers. Also fully remote businesses. It's clear to me Stripe wants brick and mortar businesses, or online businesses that have an office. Which I find sad, because they're abandoning a bunch of customers depending on them. Though it is an opportunity for some startup to cater to those customers.
A physical biz address does not mean you have to have an office.
I’ve been using my home address as the business address of my company ever since I first created it, and before that I did the same for my sole proprietorship.
I imagine their point is deciding whose home address is used among many people working on a music festival, is tough. If that person leaves/is disgruntled, it’s still THEIR name and address on the account, where as most business mail boxes can be shared.
Not sure of the legal implications of that, I’m just reading their comment how I think they meant it to be read.
If you read Stripe's notice, they need the address for sole proprieters and single member LLCs. It's not controversial nor difficult to identify who that should be.
Something I enjoy doing is looking up the true landlords of managed properties to see if they're absentee. More often than not, their business address gives me their home address somewhere across the country.
Just a thought. Nearly every landlord I've had has been an absentee landlord. Quite interesting.
This is the perfect reason for having a true separation of personal / biz addresses and the reason I went for the UPS box in the first place. Business is business and home is home. It becomes more clear if I had some sort of public persona based biz too. Youtube etc. or some controversial company, even slightly so.
> Many people at RenFaires and music festivals use Stripe.
Are you thinking of Square, perhaps?
How will any of this hurt those businesses?
> Also fully remote businesses.
Fully remote businesses still have a headquarters address.
There's a lot of FUD in this comment section, but any business that is already doing business things is registered for paying taxes, which requires an address.
No lol. They just need to provide a physical address, this is a pretty normal requirement when conducting business, even in today's online world.
Those fully remote businesses still have to have a registered agent where they can receive physical mail or be served legal documents. They can just use that address with stripe.