taxes Archives - Going Dad

If you are a young business owner, the process of setting everything up can be especially confusing. One of the things that you will need for your business come tax season is an EIN, or an Employer Identification number. The EIN number serves to identify your business to the IRS for tax purposes. Once you apply for and receive an EIN for a given business, that number will remain tied to your business and you will use it to file your taxes every year. Here is a bit more that young business owners should know about the EIN.

Age Limits: There is no age limit for acquiring an EIN. However, if you are a minor, you may want to check the laws in your given state to ensure that you are legally able to work. If you are not yet able to be an employee, you may be able to obtain an exemption as a small business owner- though minors will likely need parental consent.

Who Needs an EIN?: An EIN is required for small businesses and other ventures that require employees. For instance, if you are starting a business with a group of friends, you likely need an EIN. However, if you are an independent contractor and are the only employee in your business, you may not need that number and may instead use your social security number to file your taxes.

The Process: To receive your EIN, you will need to fill out Form SS-4. You can apply for an EIN online- this is usually fastest, easiest, and the most convenient method. You also have the option of mailing or faxing a completed SS-4 form to the IRS, but be prepared to wait several weeks for a response.

While being a young business owner can be complicated, tax season can be fairly simple with a bit of research and the right resources.

For more, visit www.irs-ein-tax-id.com.

Think of an Employer Identification Number (EIN) as something similar to a Social Security Number (SSN). Much like your SSN identifies who you are to the government, your EIN identifies your company to the IRS. Many business owners and entrepreneurs use EINs instead of SSNs when conducting business activities that might otherwise require an SSN.

In short, the IRS requires an EIN in order to identify your business and track the activities with which it has been engaged. Your business needs an EIN if it meets any of the following criteria:

Your business has employees.
Your business is a partnership or corporation.
You plan to withhold income taxes in addition to paid wages to a nonresident of the United States.
You are involved in various organizations that can be found on the IRS website.

Please note that the above is not an exhaustive list! You might also need an EIN to open a business bank account or credit card, for example, or even to apply for necessary business permits. EINs are also great because they help you maintain your privacy by allowing you to engage in business without exposing your SSN.

EIN Application Online

The great new sis that you can apply for an EIN online for free! All you have to do is visit the IRS website and follow the instructions that are contained within. Don’t be tricked into thinking that you need to pay someone to apply for an EIN when you can complete the process for free!

If you need an EIN for your business, consider taking the time to apply for EIN online today! You must be the company’s owner, principal officer, general partner, grantor, or trustor and have your personal information handy when moving through the application process.

Looking to apply for a tax ID number? Start a business? Visit GovDocFiling.com for more.