You may have heard the term “EIN” before, but you might not be sure what it is. EIN stands for Employer Identification Number, and it is a nine-digit number that is used to identify businesses for tax purposes. If you have an LLC, you will need to get an EIN from the IRS. It’s also sometimes referred to as a Tax ID number, and it allows the IRS to identify your business when you file taxes. It’s important to note that an EIN is not the same thing as a Social Security Number; it’s specifically for businesses.
What is an EIN?
An EIN is a nine-digit number that identifies your business to the IRS and other government agencies. This number is used when filing taxes, opening bank accounts, applying for tax exemptions, or hiring employees. An EIN can be obtained from the IRS website.
Getting an EIN for your LLC is important because it helps you keep track of all financial activities related to your business. It also helps protect you from identity theft, since the information associated with your EIN will not match up with any individual’s Social Security Number.
If you’re still not sure whether or not you need an EIN for your LLC, the answer is yes; an EIN is a necessary part of establishing and operating your LLC. Without it, you won’t be able to open a business bank account or complete any other official transactions. Don’t wait until tax time to get an EIN; the sooner you apply, the better! It’s easy and free to obtain an EIN from the IRS website, so don’t delay in getting one for your LLC today.
Getting an EIN for your LLC as a US person (citizen or green card holder)
If you are a US person and would like to get an EIN for your LLC, the process is relatively simple. All you need to do is fill out Form SS-4 from the IRS website, submit it online or by mail, and wait for the IRS to provide your EIN. if you submit online, you usually have your EIN within minutes. If for some reason you need to submit it by mail, it takes up to 4 weeks. Once you have received your EIN, you should keep it in a secure place – this number will be needed whenever you file taxes or open a business bank account. It’s important not to share this number with anyone else as it uniquely identifies your business.
Getting an EIN for your LLC as a non-US person (non-resident alien)
If you are a non-US person and would like to get an EIN for your LLC, the process is slightly different. You must fill out Form SS-4 from the IRS website, but then you will need to submit it by mail or fax. Once you have received your EIN, you should keep it in a secure place – this number will be needed whenever you file taxes or open a business bank account. It’s important not to share this number with anyone else as it uniquely identifies your business. It should take up to 4 weeks for the IRS to return your EIN letter. You will need this letter for opening bank accounts.
Do I need an EIN for a single-member LLC?
If you are a US person, it is not required to have an EIN for your LLC. You can use your SSN as your company tax id. In this case your LLC will be considered a disregarded entity and any profit or loss will pass thru to your personal tax return on your Schedule C. However, if you have employees, it would be preferable to get an EIN at that point.
If you are a non-US person, you will need an EIN for your LLC. Since you are a not a US person, you will not likely have an SSN or ITIN, therefore you will need the EIN to open bank accounts and other financial accounts for your LLC.
We would still recommend getting an EIN for your business in any case since it gives you an additional layer of privacy and separation from your LLC.
Do I need an EIN for a multi-member LLC?
Yes. If you have a multi-member LLC, the IRS requires that you obtain an EIN for your business. The process is similar to obtaining an EIN as a single-member LLC; you must fill out Form SS-4 and submit it online or by mail. Once you have received your EIN, you should keep it in a secure place – this number will be needed whenever you file taxes or open a business bank account. It’s important not to share this number with anyone else as it uniquely identifies your business.
Since a multi-member LLC has more than one member, the business is treated as a partnership for tax purposes. Because of this, an EIN is required because the LLC will then need to file a partnership tax return (1065) and issue each member a K1 tax statement showing their respective share of the profit or loss of the LLC.
Summary
If you are a US person, it is not required to get an EIN for a single-member LLC. However, if you have employees or want additional privacy and separation from your business, then we would recommend getting one. If you are a non-US person or have a multi-member LLC, then you will need to obtain an EIN for your LLC. The process is simple and free; just fill out Form SS-4 online or by mail and wait for the IRS to issue your EIN letter. Once you receive it, keep it in a secure place as this number will be needed whenever you file taxes or open business bank accounts. So don’t wait – apply for an EIN today!