Get an EIN to Register Your LLC as a Recognized Business
What is an Employer Identification Number.
Also known as a “Tax ID number,” the EIN Number lookup in USA is a business federal tax ID that works like a Social Security Number for your business. Your EIN helps you file tax returns for your business, is typically required to open a business bank account under the name of your business, helps you properly pay and account for wages and payroll for your company’s employees, and otherwise helps establish credit for your business and maintain your business’s official standing as a legal business entity.
What is an Employer Identification Number
Also known as a “Tax ID number,” the EIN Number in USA is a business federal tax ID that works like a Social Security Number for your business. Your EIN helps you file tax returns for your business, is typically required to open a business bank account under the name of your business, helps you properly pay and account for wages and payroll for your company’s employees, and otherwise helps establish credit for your business and maintain your business’s official standing as a legal business entity.
What is an EIN?
An Employer Identification Number (EIN) is a 9 digit number or code assigned by the IRS in the United States to identify your business. You can think of it as your company’s Social Security Number or also known as the Taxpayer Identification Number. A business EIN is important for many reasons, such as opening a business bank account and getting financing. You can also use it to hire employees and more.
Without an EIN, your business will be more susceptible to liabilities and legal risks. Also, without an EIN, you can’t keep funds from your personal life separate from your business funds.
All sole proprietors are HIGHLY encouraged to get an EIN! In order to keep your business and personal transactions separate, please secure a federal EIN number and establish a separate business bank account.
Would you like to apply online for an EIN? If yes, now’s the time. The process of getting one is quick and easy and offers a range of benefits that could help you get your business off the ground. Some businesses need an EIN in order to fulfill tax requirements, but others may benefit from having one just to manage their finances better.
Why Get an EIN?
You should fill in your EIN application right away to obtain an EIN, here’s why
Get Recognized as a Business
An EIN helps you get identified as a business entity by IRS, banks, credit card companies, and other entities who want to track your business and personal finances separately.
Accounting & Financing Privileges
When you’re thinking about opening a bank account, make sure you get an EIN. This will guarantee lending institutions take your business seriously when it comes time to finance your company.
Accounting & Financing Privileges
The IRS uses the EIN for payroll, federal tax returns, and any retirement plans you offer. Hire employees and offer competitive salaries or retirement-based plans. Your employees are your most precious resource!
Who Should Get an EIN?
People partner EINs with large companies, however even a consultant or the proprietor of a tiny business could require an EIN to document business transactions and for different purposes. In the event that you really do require a business tax ID, the best practice is to get one when you open your business. Make it a part of your business’s bucket list agendas.
Being registered with the IRS will save you time, energy, and money. Among other things, it will ensure that you know what tax obligations you have and help keep your books organized.
The entities that SHOULD get an EIN are
- A Business with Employees
- Corporations or Similar Entities
- Multi-member LLCs
- Buying or Inheriting a Business
- Have a 401(k) Retirement Plan
- If Filing for Bankruptcy
Other Key Benefits of an EIN
Protect Yourself From Additional Liabilities
An EIN shows that you and your business are separate entities. This helps you avoid being personally liable for any debts that the company is liable for and vice versa.
Protect Yourself From Identity Theft
An EIN is an added protection that you offer yourself. You’ll show an EIN instead of your personal social security number to suppliers and lenders, reducing the risk of identity theft significantly.
Become Credible for Vendors
Having an EIN number will make partnerships possible. Vendors and distributors might want to check your business credit or EIN before signing up to work with you. Having an EIN shows that you have a credible business and are reliable.
Accelerate Your Loan Applications
Having an EIN can speed up the business loan application process. The catch is that numerous moneylenders expect candidates to have a business financial balance. This is to guarantee that you can credit assets and make occasional advance installments. To get a business financial balance, you frequently need an EIN.
Become a Reputable Freelancer or Independent Contractor
When you take on a client, you’ll need to give either a Government backed retirement number or EIN to them so that you can legalize a 1099 tax document. Having an EIN adds greater credibility and implies that you have a serious business rather than something you’re simply doing as a second job.
What’s in it for the Overseas Entrepreneurs?
Having an EIN can be especially useful for beginning a business if you’re a non-U.S. resident without a Government managed retirement number. Foreign nationals can apply for an EIN by reaching the IRS.
As an overseas entrepreneur, before obtaining a Social Security number, you might be able to open a company bank account or apply for a business credit card if you have an EIN. This helps you get started with your company and may even give you a competitive edge. However, you need to act swiftly and obtain your EIN number as soon as you decide to establish a business.