EIN

 Who needs an Employer Identification Number (EIN)?

Most small businesses, as well as people who work as independent contractors, should get an EIN. It only takes a few minutes and is completely free through the IRS.

This is especially important when hiring employees or even issuing a Form 1099-NEC to an independent contractor.

How do I get an Employer Identification Number (EIN)?

Visit the IRS site HERE to get started. You will need to ensure you meet the eligibility requirements.

·         Click Apply Online Now

·         Read through the instructions then select Begin Application

·         Select the applicable type of structure from the following choices:

o   Sole Proprietor

• Only one owner of the company

• No additional steps are needed usually.

o   Partnerships

• Two or more owners

• Must have a Partnership Agreement

o   Corporations

• One or multiple owners

• Must incorporate at the state level.

• Options for how the company will be taxed.

o   Limited Liability Company

• One OR multiple owners

• Must organize at the State Level

• There may be several tax scenarios to consider depending on the number of owners.

  • Single Member LLC taxed as a sole proprietor.

  • Multiple members classified as a Partnership (Husband and Wife partners may be different depending on the state)

  • Select S Corp status (OWNER MUST BE ON PAYROLL)

o   Estate

• Obtained on behalf of a decedent.

o   Trusts

• EIN typically required for all irrevocable trusts.