Do I need a Tax ID to form an LLC?

The answer is yes, any limited liability company (LLC) with employees is required by the Internal Revenue Service to get a tax ID number. The tax identification number is often recognized as an Employer Identification Number (EIN). A tax identification number is used to identify a company for tax purposes in the same way as a person is identified by a Social Security number. The IRS regards your LLC as a taxable entity that answers to the question “do Limited Liability Companies file tax returns” Additionally, LLCs with more than one owner must obtain an EIN too.

What is a Tax ID? #

A Tax ID also called as EIN is an abbreviation for the Employer Identification Number that is assigned to a business entity. It is also called the Federal Tax Identification Number (FEIN). With the help of your Tax ID, the Internal Revenue Service (IRS) can easily identify your entity. You may consider it as your Social Security Number (SSN) for your business. Just as an SSN is important for those living in the US, the EIN is also necessary for businesses conducted in the USA.

What are the main benefits of a Tax ID for your LLC? #

It is undeniable that there are several benefits of LLC for EIN. Basically, having an EIN  does more than allowing you to pay taxes. Most importantly, business owners prefer to use an EIN on most paperwork in lieu of providing their personal social security number. For someone who is concerned about the risk of identity fraud, this is an excellent option and many people use this approach even though they are not legally required to get an EIN. Other benefits of a Tax ID for LLC owners are;

  • Open bank accounts or secure loans or unsecured credit lines for the company,
  • Obtain local licenses and company licenses,
  • Legally hire workers and apply for a payroll program,
  • Applying for business permits

Ways of Getting a Tax ID #

Applying an EIN is so simple. Filling out the SS-4 Form is the key point here. Form SS-4 is required while getting an EIN. When you visit the IRS’s website, you will see that applying an EIN is being made online. However, mostly, you will need to spend a lot of time on figuring out the requirements. Dealing with paperwork can be quite time-consuming and challenging. Here is what you need to apply for a Tax ID:

LLC tax id
  • You may apply for an EIN online,
  • You can fax the completed Form SS-4 application to the appropriate fax number,
  • You can mail your Form SS-4 application to the IRS,
  • You can apply by calling 267-941-1099,
  • You can consult us in order to represent your business as a third-party designee. We will prepare your documents and send them to the IRS. Finally, we will receive your EIN on your behalf.

Situations that you don’t need to obtain a Tax ID number #

If you own a Limited Liability Company as a single member or with no staff, you are not required to hold a Tax ID number. In this case, you may use your Social Security Number (SSN) instead of using a Tax ID for your business purposes. However, if you are not eligible for an SSN, we highly recommend you obtain an EIN. It is not needed to get a new EIN for your Limited Liability Company that changes its name or location.

If any partnership changes its business structure like an LLC, that partnership can continue carrying its business with the same Tax ID on the condition that LLC is classified as a partnership for taxation purposes.

To sum up, we highly recommend you get professional help in order to receive your EIN on time and guaranteed. You can always consult us without any hesitation by sending an e-mail to [email protected]