On paper will look like clear cut case of money laundering.

She mentioned that it has been over a year, and she recently showed me the full transaction history from PayPal. Over the past year, there have only been two refund cases. As for disputes none.

Apologies for the delayed response. She has already contacted a tax consultant. To summarize, all income generated through her Stripe and bank accounts is subject to Malaysia's tax regulations.

She is required to provide all proof of delivery, documents, e-invoices from Stripe, and any other related documentation, ensuring that everything is backed up in case of any inquiries.

In short, all income is taxable by LHDN (Inland Revenue Board of Malaysia).

Regarding your question, she mentioned that she is already familiar with the software/services, as she uses them herself. Her role, on the other hand, is to manage the website, including providing live support (24/7 or as available), as well as tracking all income, refunds, and any disputes, if they arise.

Well I'm not fully sure how tax work in Malaysia so wish her luck tho, I also told her maybe should stop doing it since it's hard to deal with foreign country, what more it's in US.

The tax consultant is advised on taxes only..
Still a red flag.