Federal Tax ID
Having a Employer Identification Number (or EIN) helps separate you from your business. If you don’t have one, you will use your social security number on any business licenses, permits & tax forms. Using an EIN keeps your business at arm’s length.
Getting a Federal Tax ID number is optional if you’re a sole proprietorship, but if your business acts as a Corporation, Limited Liability Company or a partnership, you are required by law to have one.
When you first start a business or hire employees, you should get your Employer ID Number. Also, if you are incorporating or filing as an LLC, this is also a good time to get it. Without a Federal Tax ID Number, you can’t get a business bank account or file your business tax returns.
If you had an EIN as a sole proprietor and now want to incorporate or file as an LLC, you will need to reapply for a new Employer Identification Number, as, essentially, you as starting a new business, at least in business status. Keep in mind you will also need a new business bank account if you originally opened one as a sole proprietor.
You can apply for your EIN online through the IRS’ website, or you can let Taxrole do the work for you. Having us help you can help save you time and money, and we can bundle your Federal Tax ID Number with one of our other business filing services.